Reliability has become a greater concern in shipboard systems due to increasing amount of technology level, system complexity, and multiple design demands. Enhancement of the shipboard system’s reliability ensures safe and continuous operation onboard a ship. To enhance the reliability of the shipboard system, it is essential to identify each individual component’s reliability. Within this scope, the onerous task of reliability allocation analysis enhances the reliability of shipboard systems through the optimization of component-based designs, construction, and operations. This study proposes a hybrid reliability allocation methodology based on a hierarchical structure with the integration of an analytic hierarchy process (AHP), data envelopment analysis (DEA), and feasibility of objectives (FOO) methods. The proposed methodology provides reliability allocation analyses for systems with any number of components. The study also examines the usefulness of the adaptation of AHP-DEA into reliability allocation analysis. To demonstrate the applicability of the proposed methodology, a case study on the steering gear system is presented.