This paper develops an analytical model to investigate the effect of inhomogeneity in races on the dynamic behaviors of rolling bearing. The governing differential equations are obtained based on the Hertz contact theory and bearing kinematic equations with the centrifugal force and frictions considered. The surface disturbed displacement caused by inhomogeneities is obtained by the semi-analytical method (SAM) and treated as local surface defect in equations of motion through load–deformation relation. For the first time, the effect of material inhomogeneity on dynamics of rolling bearing is explored. The result shows that the inhomogeneity can make the system motion more complicated. The inhomogeneity in the inner race has a greater influence than in the outer race.