Among motor faults, bearing, rotator, and stator failures are the most commonly reported. Because of the low-amplitude fault signatures in the current spectrum, they are also the most challenging to diagnose, even in line-driven motors. However, a fault simulator of induction motors has not been adequately investigated in the literature. The purpose of this paper is to build a hardware-in-the-loop (HIL) simulation system to model system failures of induction drives. The HIL system is based on a dynamical mathematical model, consisting of a dSPACE control system to process data and a real dc motor. The proposed system can produce bearing, rotator, stator, and sensor failures for testing of various fault diagnosis schemes. The experimental results show its functionality.