6th European Workshop on Structural Health Monitoring. Dresden. Germany. 2012. Report. Condition monitoring and fault detection systems are now becoming increasingly important in rail vehicles maintenance and operation, ensuring safety and reliability improvement. Up to now light rail vehicles were not the main target for this trend, because of low operation speed and lower safety factors. Nevertheless public transport operators begin to pay a closer attention to the condition monitoring of tramways, in order to reduce maintenance cost and increase safety and ride comfort for passengers, which is a very important task for public transport competitiveness in XXI century. Responding to the needs of the industry, a condition monitoring system for light rail vehicles and track was designed, built and tested in normal tramway operation. All important system requirements were developed on the base of present state and knowledge analysis, followed by many numerical simulations. The paper describes the system architecture, as well as the monitoring concept and the final implementation phase.