The current research of reliability allocation of CNC lathes always treat CNC lathes as independent series systems. However, CNC lathes are complex systems in the actual situation. Failure correlation is rarely considered when reliability allocation is conducted. In this paper, drawbacks of reliability model based on failure independence assumption are illustrated, after which, reliability model of CNC lathes considering failure correlation of subsystems is established based on Copula theory, which is an improvement of traditional reliability model of series systems. As the failure time of CNC lathes often obeys Weibull or exponential distribution, Gumbel Copula is selected to build correlation model. After that, a reliability allocation method considering failure correlation is analyzed based on the model established before. Reliability goal is set first and then failure rates are allocated to subsystems according to the allocation vector through solving the correlation model. Reliability allocation is conducted for t = 1. A real case of a CNC lathe and a numerical case are presented together to illustrate the advantages of the reliability model established considering failure correlation and the corresponding allocation method. It shows that the model accords to facts and real working condition more, and failure rates allocated to all the subsystems are increased to some extent. This research proposes a reliability allocation method which takes failure correlation among subsystems of CNC lathes into consideration, and costs for design and manufacture could be decreased.