A device for simultaneously monitoring the health of surgical drills and detecting proximity to critical structures during surgery is described herein. By using various sensors (e.g. microphones, accelerometers, temperature sensors, etc.), signals from the drill can be measured and analyzed. The processed signals can then be used to indicate the proximity of the drill bit to critical structures, such as the patient’s brain, and identify drill health issues (e.g. worn bearings, misaligned rotational axis, etc.).