The purpose of this study is to perform the reliability-corrected development cost estimation of the launch vehicle at the conceptual design phase. In order to estimate the launch vehicle development cost, the estimation method based on the independent variable such as the rocket performance and dry mass has been mainly implemented up to now. This approach has made the approximate cost estimation possible, however, the cost variation according to the reliability requirement could not be reflected. In this paper, the cost estimation methodology that introduces the reliability factor in addition to the performance and mass in the TRANSCOST model is presented in order to improve the limitation of current cost estimation method. The development cost of KSLV(Korea Space Launch Vehicle)-II is estimated on the basis of this newly implemented concept with reliability as an added parameter.