This study proposes a novel intelligent fault diagnosis method for rotating machinery using ant colony optimization (ACO) and possibility theory. The non-dimensional symptom parameters (NSPs) in the frequency domain are defined to reflect the features of the vibration signals measured in each state. A sensitive evaluation method for selecting good symptom parameters using principal component analysis (PCA) is proposed for detecting and distinguishing faults in rotating machinery. By using ACO clustering algorithm, the synthesizing symptom parameters (SSP) for condition diagnosis are obtained. A fuzzy diagnosis method using sequential inference and possibility theory is also proposed, by which the conditions of the machinery can be identified sequentially. Lastly, the proposed method is compared with a conventional neural networks (NN) method. Practical examples of diagnosis for a V-belt driving equipment used in a centrifugal fan are provided to verify the effectiveness of the proposed method. The results verify that the faults that often occur in V-belt driving equipment, such as a pulley defect state, a belt defect state and a belt looseness state, are effectively identified by the proposed method, while these faults are difficult to detect using conventional NN.