Aiming at the problem that the complicated structure and the shortage of fault statistics information in hydraulic systems, a multi value testability analysis method based on simulation model is proposed. Based on the simulation model of AMESim, this method injects the simulated faults and records variation of test parameters ,such as pressure, flow rate, at each test point compared with those under normal conditions .Thus a multi-value fault-test dependency matrix is established. Then the fault detection rate (FDR) and fault isolation rate (FIR) are calculated based on the dependency matrix. Finally the system of testability and fault diagnosis capability are analyzed and evaluated, which can only reach a lower 54%(FDR) and 23%(FIR). In order to improve testability performance of the system,. number and position of the test points are optimized on the system. Results show the proposed test placement scheme can be used to solve the problems that difficulty, inefficiency and high cost in the system maintenance.