Performing condition monitoring on rotating machines which operate under fluctuating conditions remains a challenge, with robust diagnostic techniques being required for the condition inference task. Some of the developed diagnostic techniques rely on the availability of historical fault data, which is impractical or even impossible to obtain in many circumstances and therefore novelty detection techniques such as discrepancy analysis are used. However, discrepancy analysis assumes that the condition of the machine is the same throughout the signal in the model optimisation process i.e. no localised damage is present, which can pose problems if the training data unwittingly contain a component with localised damage. In this paper, an automatic procedure is proposed for diagnosing localised gear damage in the presence of fluctuating operating conditions, with no historical data being required to model the data used in the condition inference process. The continuous wavelet transform, principal component analysis and information theory are used to obtain divergence data of the gear under consideration. The divergence data are used with Bayesian data analysis techniques to automatically infer the presence of localised anomalies due to localised gear damage. The proposed technique is validated in two experimental investigations, with promising results being obtained.