Based on the deficiency in the traditional fault diagnosis method of rotating machinery, i.e. shallow learning is usually used to characterize complex mapping relationship between vibration signals and the rotor system, a deep neural network (DNN) based on stacked denoising autoencoder (SDAE) is proposed. The proposed method has been successfully applied to the fault diagnosis of rotating machinery. In the proposed method, the frequency domain information of vibration signal is used as input signal, and the deep neural network is obtained by layer-by-layer feature extraction from denoising autoencoder (DAE). Then the dropout method is used to adjust the network parameters, and reduces the over-fitting phenomenon. In additional, the principal component analysis is used to extract fault features. The experiment result shows that the proposed method is very effective, and can effectively extract the hidden features in the vibration signal of rotating machinery.