In order to further reduce the misoperation after the faults occurring of nuclear-powered system in marine, the model based on weighted degree of grey incidence of optimized entropy and fault diagnosis system are proposed, and some simulation experiments about the typical faults of steam generator of nuclear-powered system in marine are conducted. And the results show that the diagnosis system based on improved degree of grey incidence model is more stable and its conclusion is right and can satisfy diagnosis in real time, and higher faults subjection degrees resolving power can be achieved.