The size of the power system is growing exponentially due to heavy demand of power in all the sectors viz. agricultural, industrial, residential and commercial ones. Due to this chance of failure of individual units leading to practical or complete collapse of power supply is common to be encountered. Also a most successful power system is one which works with minimum interruptions. The reliability of power system is therefore most important feature to be maintained above some acceptable threshold value. Furthermore the maintenance of individual units can also be planned and implemented once the level of reliability for given instant of time is known. The paper therefore aims at determining the threshold reliability of generation system. The generation system consists of boiler, water, blade angle in turbine, shaft coupling, excitation system, generator winding, circuit breaker and relay. It is therefore the reliability of generation system shall be effected even when any one of the component's reliability is at stake. This paper presents the mathematical model of reliability of individual components and equivalent reliability of entire generation system. It suggests the approach to determine the critical reliability of both individual and equivalent reliability of the generation system.