In this paper, a rotating cantilever beam is used to simulate the rotor helicopter blade structure, and the damage identification problem is studied. Firstly, based on finite element method and Hamilton variational principle, a dynamic model of rotating structure is established. The model is verified by comparing theoretical and experimental results. Secondly, the damage identification of the rotating cantilever beam is studied by choosing different mode parameters (displacement mode and strain mode). Thirdly, for the displacement mode, based on singularity analysis characteristics of wavelet transform, the method of damage identification assisted by wavelet coefficients is studied. The results show that the damage identification effect of strain mode is better for rotating structure, and the displacement mode can achieve a more accurate damage identification if it can be combined with the singularity analysis of wavelet transform.