Sensors are configured to repeatedly monitor variables of a physical system during its operation. A novelty detection system is responsive to the sensors and is configured to repeatedly observe into an associative memory, states of associations among the variables that are repeatedly monitored, during a learning phase. The novelty detection system is further configured to thereafter observe at least one state of associations among the variables that are sensed relative to the states of associations that are in the associative memory, to identify a novel state of associations among the variables. The novelty detection system may determine whether the novel state is indicative of normal operation or of a potential abnormal operation. Multiple layers of learning for real-time diagnostics/prognostics also may be provided.