This paper deals with an application of the Yule series model for contactless (blade tip timing, BTT) measurements. The approach creates a straightforward processing procedure from the experimental data to obtain estimates of blade logarithmic decrement and natural frequency. The existing analytical expressions for confidence intervals enable a priori evaluation for the accuracy of blade oscillation characteristics estimates. Proposed sensors allocation scheme ensures oscillation sampling rates providing efficient estimates of oscillation characteristics. Real-time measurements of blade logarithmic decrement and natural frequency give a chance of this method implementation for research and health monitoring purposes.