To realize the accurate fault detection of rolling element bearings, a novel fault detection method based on non-stationary vibration signal analysis using weighted average ensemble empirical mode decomposition (WAEEMD) and modulation signal bispectrum (MSB) is proposed in this paper. Bispectrum is a third-order statistic, which can not only effectively suppress Gaussian noise, but also help identify phase coupling. However, it cannot effectively decompose the modulation components which are inherent in vibration signals. To alleviate this issue, MSB based on the modulation characteristics of the signals is developed for demodulation and noise reduction. Still, the direct application of MSB has some interfering frequency components when extracting fault features from non-stationary signals. Ensemble empirical mode decomposition (EEMD) is an advanced nonlinear and non-stationary signal processing approach that can decompose the signal into a list of stationary intrinsic mode functions (IMFs). The proposed method takes advantage of WAEEMD and MSB for bearing fault diagnosis based on vibration signature analysis. Firstly, the vibration signal is decomposed into IMFs with a different frequency band using EEMD. Then, the IMFs are reconstructed into a new signal by the weighted average method, calledWAEEMD, based on Teager energy kurtosis (TEK). Finally, MSB is applied to decompose the modulated components in the reconstructed signal and extract the fault characteristic frequencies for fault detection. Furthermore, the efficiency and performance of the proposedWAEEMD-MSB approach is demonstrated on the fault diagnosis for a motor bearing outer race fault and a gearbox bearing inner race fault. The experimental results verify that the WAEEMD-MSB has superior performance over conventional MSB and EEMD-MSB in extracting fault features and has precise and effective advantages for rolling element bearing fault detection.