A new approach on modeling is put forward for fully computer integrated product development.A basic concept of functional model is proposed for embodying this approach.This model is used mainly for explaning and simulating the functions and the efficiencies of various machines composed of many mechnical, fluid-mechanical and electrical parts.All organizations and engineers of various specialties in charge of the product development can collaborate one another using this model.This model can be used in all stages of product development from the initial plan through the design to the prototype testing.Functional models of single degree of freedom mechanical, electrical and fluid-mechanical systems are illustrated, and its validity and usefulness of the proposed approach are demonstrated.