Stator slot magnetic wedges are used instead of conventional epoxy glass wedges in large, high output induction motors since the motor efficiency and power factor can be improved. However, cases of loose or missing magnetic wedges due to their weak mechanical strength have recently been increasingly reported. Although missing wedges can deteriorate motor performance and reliability, there currently is no test method accepted in the field for wedge quality assessment other than off-line, disassembled visual inspection. In this paper, a new in-service method for monitoring the magnetic wedge condition in induction motors based on the negative sequence information is proposed. The new method is developed based on the analysis of the dynamic model of the induction motor with missing magnetic slot wedges, derived in this paper. The proposed method is verified experimentally on a 380 V, 5.5 kW induction motor with custom-built magnetic wedges, and on a finite element model of a 6.6 kV, 1850 kW induction motor. It is shown that the proposed method can provide on-line detection of missing magnetic wedges, which can help reduce maintenance costs and risk of degradation in motor performance.