Cylindrical roller bearings (CRBs) are subjected to significant cyclic stress under extreme operating conditions. This leads to the formation of localized wave defects on the raceway surface, such as burn. Thus, a new mathematical model is proposed to consider the local wave defects on the raceway caused by burns in this paper. Further, a dynamic model of CRB incorporating raceway defects is developed based on the contact relationships between components, and the proposed model is verified by measured acceleration responses. The effects of local wave defects on the nonlinear vibration characteristics of the bearings are studied and the results show that an increase in the number of defect waves reduces the additional displacement of rollers passing through the defect area, obscuring signal characteristics induced by the defect. Moreover, the presence of the defect influences the nonlinear interaction between the roller and raceway, which subsequently affects the cage whirling motion. This study of bearing dynamic behavior in this paper can contribute to the condition monitoring of bearings.