The Present invention discloses a method for monitoring wear of a die in a metal forming process, In particular a wire drawing process. The method consists of measuring high frequency Acoustic emission (AE) signals generated due to relative sliding of the wire and die by placing Acoustic emission sensor at a suitable location on die nut. During the wire drawing process the sensor output are sampled and processed repeatedly to obtain the acoustic emission characteristics of the process. The obtained data is analysed to determine the health condition of die, lubrication condition. By storing the acoustic emission signature and its characteristics repeatedly during the process operation, and by comparing the new signature and its characteristics with the stored ones a diagnostic information about abnormal events such as die wear, improper lubrication and ineffective cooling can be obtained.