Rotary compressor has been widely used in room air conditioner. During development of the new compressor, the abrasion of bearings and the break of crankshaft frequently occurred. So it is very important to build a numerical method to estimate the reliability of the compressor. The rotor-journal bearing system is numerically solved as a dynamic nonlinear fluid-structure interaction problem in this paper. The finite element models of the rotor and bearing housings are built up by using the Timoshenko beam model. In order to get the oil film pressure of the journal bearing, Reynolds equation is solved by variation principle, and the finite element method is used to discrete the oil film. An iterative method based on the complimentary principle is used to solve the oil film force and the Reynolds boundary simultaneously. Through analysis, the abrasion position between the bearing and shaft is presented, and the bending tension stress shows the dangerous sections of the crankshaft. Through the distribution of the oil pressure, position of the screw oil groove, which is built on the inside of the bearing housing to supply the oil to lubricate the bearing, is determined. The proper position of the radial oil hole on shaft is decided by analysis of the bending tension stress.