In this paper, a new family of wavelets derived from the underdamped response of second-order Linear-Time-Invariant (LTI) systems is introduced. The most important criteria for a function or signal to be a wavelet is the ability to recover the original signal back from its continuous wavelet transform. We show that it is possible to recover back the original signal once the Second-Order Underdamped LTI (SOULTI) wavelet is applied to decompose the signal. It is found that the SOULTI wavelet transform of a signal satisfies a linear differential equation called the reconstructing differential equation, which is closely related to the differential equation that produces the wavelet. Moreover, a time-frequency resolution is defined based on two different approaches. The new transform has useful properties; a direct relation between the scale and the frequency, unique transform formulas that can be easily obtained for most elementary signals such as unit step, sinusoids, polynomials, and decaying harmonic signals, and linear relations between the wavelet transform of signals and the wavelet transform of their derivatives and integrals. The results obtained are presented with analytical and numerical examples. Signals with constant harmonics and signals with time-varying frequencies are analyzed, and their evolutionary spectrum is obtained. Contour mapping of the transform in the time-scale and the time-frequency domains clearly detects the change of the frequency content of the analyzed signals with respect to time. The results are compared with other wavelets results and with the short-time fourier analysis spectrograms. At the end, we propose the method of reverse wavelet transform to mitigate the edge effect.