Based on the status of CBM (Condition Based Maintenance) in domestic and abroad, the authors propose a GSDM (Grey Situation DecisionMaking) method of CBM strategy for power transformers. The countermeasure set of CBM for power transformers includes the five typical maintenance schemes, such as the offline maintenance, priority plan overhaul, surveillant operation, periodic overhaul and postponed overhaul. Taking the safety and economy into account, the five qualitative evaluation indexes of decision making, such as security, reliability, maintainability, economy and monitoring feasibility, are proposed, and the quantitative method of the qualitative evaluation indexes is presented. Through constructing situation effect vectors of GSDM, the optimal maintenance strategy for power transformers can be obtained on the base of the grey relational grade between the situation effect vectors and the optimal situation effect vectors. The examples of the CBM scheme for two power transformers in service are provided to illustrate the specific process of the decision making method and to verify its effectiveness.