Moving and fixed main and arc contacts used in circuit breakers (CBs) are prone to erosion with time and usage. Static resistance measurement and dynamic resistance measurement (DRM) are well-known noninvasive methods for the condition assessment of the contacts. Practically, the implementation of various failures on contacts of the CB is so difficult due to their placement in a high-pressure interruption chamber. This paper investigates the impacts of common failure modes such as erosion, disconnection, and misalignment of contacts on DRM profile through 3-D multiphysical simulation of the interruption chamber in the finite-element analysis software COMSOL. The model has been verified against experiments conducted on a 24-kV, SF6 CB with a high-resolution scope. The measured profiles indicate that DRM exhibits specific behavior with respect to each failure, e.g., the arc contact erosion leads to a change in the commutation point in DRM. The results have been organized into an intelligent failure diagnosis algorithm based on a set of DRM-based features. In the end, the performance of the proposed algorithm which could be suitable for smart grids is evaluated in the case of an experiment.