With the advancement in automation, the roles of machine operators have shifted from traditional physical commitments to controlling the automation process. The operators need to understand and assess the incoming information and make decisions accordingly, which will determine the next move of the process and further affect the machine’s health status/performance. Such awareness and understanding of the situation, as one of the critical prerequisites of decision-making and known as situation awareness (SA), needs to be addressed appropriately in accessing the reliability of the system with human–machine interaction (HMI). Hence, we propose the HMI system reliability model considering the machine has multiple dependent degradation processes, and each degradation process is affected by the interactions of internal machine degradation, random shocks, and SA. In addition, the impacts of SA and external factors on the system are reflected in the amount and rate of the machine degradation process. The proposed model is demonstrated by a simulated case, and the sensitivity analysis is conducted to analyze the impacts of model parameters on system reliability prediction. Finally, the performance of the proposed model is demonstrated by comparing it with the existing model.