This paper investigates the effect of time delays on the stability of generator excitation control system. The time delays are due to the use of measurement devices, communication links for data transfer, and controller processing time. The stability with respect to the time delay is theoretically analyzed and a formula to determine the maximum amount of time delay known as delay margin that the system can tolerate without losing its stability is presented. It is found that the excitation control system becomes unstable when the time delay crosses certain critical values, delay margins for stability. The time-domain simulations of Matlab/Simulink are used to validate theoretical delay margin results.