The present study is a combined experimental/analytical investigation of the effect of a cracked pinion tooth on the vibrational characteristics of a power transmission system. It is part of an ongoing effort to develop strategies for locating and quantifying local defects by properly processing and interpreting the output signals. Presented, is a system of nonlinear equations representing the analytical model of an experimental test rig. The model includes the effect of crack size on the time-varying gear mesh stiffness, and the equations are solved by using a Newmark-Beta numerical integration scheme. The numerically and experimentally obtained signals, processed by using the wavelet transform, show excellent agreement over a range of crack sizes and running speeds, thus suggesting that mathematical simulation can provide a useful tool for quantifying cracks.