This paper proposes an analytical framework for vibration-based structural health monitoring (SHM) by introducing an energy-based damping evaluation (EBDE). The damage detection by the proposed EBDE was carried out by estimating the contribution of modal damping ratios from different structural elements utilizing experimentally identified modal damping ratios, and estimating modal strain and modal potential energies from an updated finite-element (FE) model of the structure under consideration. Model updating was performed using modal frequencies and mode shapes that are generally not sensitive to local damage. The advantage of using damping as a damage indicator is that the damping change in global modes affected by the local damage can be identified with a small number of sensors. A previous study reported that the studied bridge with damage at the local diagonal member showed a significant increase in the damping of global vibration mode of the structure. The present study utilized the EBDE to identify the cause of the modal damping increase by observing the change in the contribution from different structural elements on the modal damping ratios.