The power transformer is a complex and critical component of the power transmission and distribution system. System abnormalities, loading, switching and ambient condition normally contribute to accelerated aging and sudden failure. In the absence of critical components monitoring, the failure risk is always high. For early fault detection and real time condition assessment, an online monitoring system in accordance with the age and conditions of the asset would be an important tool. Power loss, heat generation and heat distribution evaluations in a large-scale oil immersed power transformer are presented here, along with the details of computer implementation and experimental verification. Core power losses are approximately constant with temperature variation or may decrease with that. Over the temperature range of 20 to 100°C the change in hysteresis loss Ph with temperature was negligible. Since the total core loss PT decreased with increasing temperature over this range, almost all the loss reduction was due to a reduction in the eddy current loss component Pe that was inversely proportional to the resistivity. Winding and oil temperature will increase with the load increasing and may create a hot spot. This is caused by degradation insulation and the loss of life in the power transformer. Hottest spot temperature and temperature profiles in radial and height coordinates were found using three different methods in this paper. The finite element method (FEM), finite difference method (FDM) and discrete furrier transform methods (DFT) are used to analyze algorithms in this paper. Computational results based on theoretical considerations and using the DFT method are shown to be in good agreement with FDM and FEM. Two mathematical formulae are proposed for temperature distribution in both radial and horizontal axes of core and windings. COMSOL for FEM, GEMINI for FDM and MATLAB for DFT are used.