Incremental capacity analysis (ICA) is a widely used technique for lithium-ion battery state-of-health (SOH) evaluation. The effectiveness and robustness of ICA for single cell diagnostics have been reported in many published work. In this study, we extend the ICA based SOH monitoring approach from single cells to battery modules, which consist of battery cells with various aging conditions. In order to achieve on-board implementation, an IC peak tracking approach based on the ICA principles is proposed. Analytical, numerical and experimental results are presented to demonstrate the utility of the IC peak tracking framework on multi-cell battery SOH monitoring and the effects of cell non-uniformity on the proposed method. Results show that the methods developed for single cell capacity estimation can also be used for a module or pack that has parallel-connected cells.