In the present chapter, a new fuzzy logic (FL) model is proposed to evaluate the overall health index (OHI) of power transformers. The most significant attributes such as dissolved gases, acidity, 2-furfuraldehyde, water content, breakdown voltage and dissipation factor that influence the health condition of transformers solid and liquid insulations are considered. These attributes are further divided into three different sets. Based on these sets, three different sub fuzzy models i.e. F1, F2 and F3 are designed in order to reduce the possible combinations of fuzzy rules. It results in reducing the complexity issues of the proposed OHI model. In addition, consideration of all significant testing parameters makes the model more reliable and accurate. Further, the proposed fuzzy model helps in initiating appropriate and early action on faulty conditions of the transformers. Conventional fuzzy logic models generally utilize large number of inputs and more number of rules in a single fuzzy model. It makes the models complex and inaccurate. Such shortcomings of existing conventional models are successfully overcame by the present proposed model. Furthermore, the results obtained from the proposed model are compared with the results obtained from expert model proposed by Abu-Elanien et al. This comparison ensures the reliability of the proposed method. Also, it is envisioned that the proposed model can be easily implemented by both the experienced and the inexperienced utility managers.