Power transformers are one of the most expensive components; therefore the focus on their status and its continuous operation is the primary task. In the power systems, condition assessment of performance and reliability is based on the state of components, measurements, testing and maintenance as well as their diagnosis. Hence, condition assessment of power transformer parameters is the most important regarding their status and finding incipient failures. Among many factors, the most factors that affects the safe operation and life expentancy of the transformer is the moisture in oil. It is known that the low moisture oil in power transformers causes many problems including electrical breakdown, increase the amount of partial discharge, decreases the dielectric withstand strength and other phenomena. Thus, knowledge about the moisture concentration in a power transformer is significantly important for safe operation and lifespan. In this study, moisture level in oil is estimated and its status classification is proposed by using fuzzy logic techniques for the power transformer monitoring and condition assessment. Moreover, the goal of the study is to find methods and techniques for the condition assessment of power transformers status based on the state of moisture in oil using the fuzzy logic technique. These applied techniques increase the power system reliability, help to reduce incipient failures, and give the better maintenance plan using an algorithm based on logic rules. Also, by using the fuzzy logic techniques, it is easier to prevent failures which may have consequences not only for transformers but also for the power system as a whole.