This paper discusses the analysis of flexible manufacturing systmes design using computer simulation method. The simulation language employed is SIMAN which is a powerful tool to model flexible manufacturing systems. The important characteristics of FMS, its design and operational problems, and structures based on the number of NC machine tools and their layout are discussed for the appli- cations of FMS to manufacturing. A new algorithm for forming part families and machine groups has been proposed and its software is also developed. Simulation procedure using SIMAN for analysis of FMS designs is discussed and two design problems are analyzed and evaluated to illustrate systemstic procedure for analysis of FMS.