Wrong decisions during the missions can lead to an unsafe condition or immediate failure, while correct decisions can help continue the missions even from faulty conditions. In view of the lessons learned from mishaps, i.e., failed space missions, it is imminent that reliability analysis and risk assessment are kept in sync with space system design as it evolves from the concept through preliminary design, detailed design, production, and operations. Qualtech Systems, Inc. (QSI) in collaboration with Dr. John Sheppard from Montana State University (MSU) proposes a real-time health and risk assessment solution. The proposed efforts through this project in developing real-time computer-based environment for diagnosis, risk assessment, and visualization of system status will provide: (1) an environment for thorough and collaborative analysis and evaluation of a system design before the system is built and commissioned, (2) real-time diagnosis to identify Good, Bad, Unknown, Suspect, Degraded and Suspected Degraded of subsystems/components, (3) state of redundancies in real-time in case of single/multiple faults, (4) degradation status/criticality/time-to-failure, (5) risk identification of software and loss of mission/vehicle/life, (6) recommendation of a safer state to go to, and (7) visualization of risk (rank-ordered missions, probability of mission success, schedule and cost), mission criticality, and diagnostic coverage. The proposed solution should be of significant relevance to NASA's space missions because it provides capabilities in characterizing as system in its failure space as well as uncovering and managing risks as the system design evolves.