Considering both static power transfer limit and dynamic load characteristics a voltage collapse alarm system, which raises different alarm levels of voltage collapse, is proposed to warn that voltage collapse will occur possibly. The higher the alarm level, the more possibly the voltage collapse occurs. Both system fault and slow load growth can lead to voltage collapse, and the proposed alarm system is designed for the latter. The proposed alarm system is implemented by fuzzy logic and it excels at processing problems of uncertain and nonlinear problems. Two main factors leading to voltage collapse, namely the static power transfer limit that is represented by line stability factor (LQP) and the dynamic load characteristics that are reflected by dQ/dt and dP/dt, are considered. By means of fuzzy processing dynamic voltage stability indices are attained and divided into different alarm levels, i.e., the voltage stability level. The feasibility and effectiveness of the proposed alarm system are verified by IEEE 39-bus system, in which electric motors are taken as dynamic load.