Abstract: At present, most satellite systems are designed as a hierarchy of subsystems. However, the subsystems with repetitive function in each subsystem are cumbersome. Thus, to overcome the shortage of the subsystem method and improve the inherent reliability of the satellite system, a new method based on the subject chain method is introduced. Based on the method, the satellite system is segmented into the control chain, the structure-thermal chain, the electronics chain and the payload chain. The inherent reliability of the satellite system is significantly enhanced, and the functional density is improved and the cost is reduced. Furthermore, the subject chain method has been successfully applied into the development for the first-launched Beidou global navigation satellite. The development cost and time are reduced markedly. In this paper, the core idea of the subject chain method and the description of four basic subject chains are also presented.