Abstract: The quality loss model proposed by Genichi Taguchi in the early 1970s is based on the absolute deviation and it is a oneorder model. However, in practice, product quality is affected by multiple factors with correlation. Thus, in this paper, the Taguchis quality loss model is expanded in considering the relative deviation of the quality indices. First, a 2order multivariate quality model is presented. Then, this model is successfully extended to models with 3 or even higher order. The 2order model is then simplified to build a multivariate quality loss model. A method is proposed to determinate the coefficients in the model. Detailed procedure for the method is described.