Effective and efficient maintenance is essential to ensure reliability of a ship's main propulsion system, which in turn is interdependent on the reliability of a number of associated sub- systems. A primary step in evaluating the reliability of the ship's propulsion system will be to evaluate the reliability of each of the sub- system. This paper discusses the methodology adopted to quantify reliability of one of the vital sub-system viz. the lubricating oil system, and development of a model, based on Markov analysis thereof. Having developed the model, means to improve reliability of the system should be considered. The cost of the incremental reliability should be measured to evaluate cost benefits. A maintenance plan can then be devised to achieve the higher level of reliability. Similar approach could be considered to evaluate the reliability of all other sub-systems. This will finally lead to development of a model to evaluate and improve the reliability of the main propulsion system.