This paper presents a proof-of-concept study on the evaluation of torsional vibration isolation performance through in-situ output torque measurement by using a non-contacting magneto-elastic torque transducer installed in the vehicle driveline system. The de-trending processing is first conducted to extract the torsional vibration from the measured driveline output torque. In order to estimate the transmissibility, primary performance indicator of a vibration isolator, the magnitude of transmitted torsional vibration with different frequencies is compared. From the conservative estimation results, the torsional damper built in a lock-up clutch of a torque converter is identified to be a vibration isolator. The evaluation results show that the fluid damping by torque converter outperforms the vibration isolation function of a torsional damper, and the isolation performance needs to be enhanced.