Development of health monitoring system has become an important task for structure damage identification. Since the building structure has many indeterminate factors, the method using modal analysis to identify the structure damage is off precision. In this paper a method applying the grey relational analysis to the structural damage identification is presented. The method uses only frequency measurement to establish the incidence order of grey relation between measured frequency and the frequency of possible damage, and to find out the optimum sequence, then by successive iteration to determine the degree and location of structure damage. Numerical simulations for frame structures are carried out, which consider many cases, including single-damage and multi-damage with different degrees and locations. The results show that for shear buildings, damage degree and location can be determined by using the grey relational analysis based on the frequency change measurement.