Delay margin is defined as the maximum time delay that system can sustain without losing its small signal stability. An effective approach is given to calculate the system delay margin. It determines the system critical eigenvalue and the local delay margin by tracing eigenvalue locus of a complex matrix in a finite interval. The proposed method does not make any transformation to the original characteristic equation. It can be applied to the delay margin analysis in the complicated bulk power systems. SMIB system and WSCC 3generator9bus system are employed to validate its effectiveness.