In this paper, oil-paper samples composed of transformer windings were used to investigate the insulation degradation process subjected to partial discharge (PD), with artificial defects inside to simulate the PD induced insulation degradation. To determine appropriate test voltages, the breakdown time obtained through a group of accelerated electrical degradation tests under high voltages was firstly fitted by two-parameter Weibull model to acquire the average breakdown time, which was then applied to establish the inverse power law life model to choose advisable test voltages. During the electrical degradation process, PD signals were synchronously detected by an ultra-high frequency (UHF) sensor from inception to breakdown. For PD analysis, the whole degradation process was divided into ten stages, and chaos theory was introduced to analyze the variation of three chaotic parameters with the development of electrical degradation, namely the largest Lyapunov exponent, correlation dimension and Komogorov entropy of PD amplitude time series. It is shown that deterministic chaos of PD is confirmed during the oil-paper degradation process, and the obtained results provide a new effective tool for the diagnosis of degradation of oil-paper insulation subjected to PD.