This paper presents an Analytical Hierarchy Process (AHP) model for prioritizing multicriteria sustainability impact of Failure Mode and Effect Analysis (FMEA). It focuses on the Malaysian palm oil mills that have been widely criticized on various sustainability issues. The data collection for pair-wise comparison of decision judgement are taken from three experts of palm oil milling process and an additional expert from the academic background. The multi-criteria of each sustainability impacts (technical, economic, environmental, and social) are assessed for the weights of the occurrence, severity, and detection of the FMEA. The result of the study suggested that the degree of failure severity for social impact is considered as the highest priority for palm oil mills. This paper provides insights for management to improve organizations’ sustainability performance at the operational level by considering sustainability impact in analyzing failure mode and effect of equipment.