The condition evaluation of insulating oil of power transformer is performed by oil contamination test and the dissolved gas analysis method. The first technique comprises of dielectric strength, interfacial tension, acidity, water content, color, and power factor. The limit value is assigned to each diagnostic test result in order to classify the condition of insulating oil as good, suspect, and poor. The second technique is based on the key gases and the Duval triangle to distinguish the possible fault types by analyzing the amount of gases dissolved in the insulating oil. Two transformer models rated 115/22 kV, 25 MVA and 230/69/22 kV, 200 MVA are selected in the analysis because of their available historical test data. The problems such as overheated cellulose, corona in oil, and thermal fault are finally recognized.