Due to the more or less fixed inherent capacity of a railway system, capacity consuming events like failures within a railway network should be kept to a minimum. This could be achieved by the use of existing and new condition monitoring systems which can detect, report and predict failure events in an early stage. Demands for higher service quality, higher capacity, network availability and track quality together with less human intervention on tracks, drive the development of railway condition monitoring systems.Failure driven capacity consumption due to worn or defected rolling stock wheels have a big impact on the capacity and the infrastructure condition. Wheel defects such as out-of-round wheels, generates high forces, and could result in large capacity consumption especially for areas with cold climate conditions. Bad wheels cause even higher track wear that reduce the life length of the track. Wheels with fatigue defects could also influence the track safety issues. This paper presents how different wheel defects can be monitored; together with a review of the most common wayside condition monitoring systems on the Swedish railway network. The study also describes how the decision making process could take advantage of the condition monitoring data in order to increase the achieved network capacity.