The present disclosure addresses the technical problem of information loss while representing a physiological signal in the form of symbols and for recognizing patterns inside the signal. Thus making it difficult to retain or extract any relevant information which can be used to detect anomalies in the signal. A system and method for anomaly detection and discovering pattern in a signal using morphology aware symbolic representation has been provided. The system discovers pattern atoms based on the strictly increasing and strictly decreasing characteristics of the time series physiological signal, and generate symbolic representation in terms of these pattern atoms. Additionally the method possess more generalization capability in terms of granularity. This detects discord/abnormal phenomena with consistency.