A passive system can fail either due to classical mechanical failure of components, referred to as hardware failure, or due to the failure of physical phenomena to fulfill the intended function, referred to as functional failure. In this paper a methodology is discussed for the integration of these two kinds of unreliability and applied to evaluate the integrated failure probability of the passive decay heat removal system of Indian 500 MWe prototype fast breeder reactor (PFBR). The probability of occurrence of various system hardware configurations is evaluated using the fault tree method and functional failure probabilities on the corresponding configurations are determined based on the overall approach reported in the reliability methods for passive system (RMPS) project. The variation of functional reliability with time, which is coupled to the probability of occurrence of various hardware system configurations is studied and incorporated in the integrated reliability analysis. It is observed that this consideration of the dependence of functional reliability on time will give significant advantages on system reliability. The integrated reliability analysis is also explained using an event tree. The impact of the provision for forced circulation in the primary circuit on functional reliability is also studied with this procedure and it is found that the forced circulation capability helps to bring down the total decay heat removal failure probability by lowering the peak temperatures after the reactor shut down.