A proposal to specify the permissible instability in the manual steering of ships was made in this paper. It had been considered that ships should be course stable to be steered by human operators. However, our experience shows this concept is true only in the case of small ships. In the case of large ships, which are usually course unstable, it is not so difficult to steer them. Then, our new problem is to find the criterion how ships can be unstable in order to be steered by human operator without excessive difficulty. In addition, the criterion should hopefully be applied for any size of ship. The concept of “Phase to be Compensated” was employed in this study to specify the instability criterion. This concept was of course deduced from the Nyquist stability criterion in the control theory. According to this concept, the behavior of human operators can be explained reasonably well and the difficulty in steering of any size of ships can be expressed on the same basis. Several important conclusions were obtained by simulator studies : (1) “Phase to be Compensated” should be less than 30 degrees. (2) Human operators select the cut-off frequency of the feed-back loop at the most favorable point when they steer unstable ships. (3) The time constant of steering gears must be small enough for small size vessels.