In this paper, a simulation algorithm for dynamic and nonlinear analysis of liquid propellant engines is presented. The application of this algorithm in a specific liquid propellant engine is developed, and the simulation results are presented. The nonlinear model of the engine is composed of a set of algebraic and a set of differential equations, and the set of equations are implicit. Until now, an algorithm for simulation of this type of model did not exist, and on the contrary to existing algorithms for simulation, the developed simulation algorithm does not depend on the type of the mathematical model of the engine. The simulation algorithm is composed of 6 primary steps. The comparison of the simulation results and that of the actual, at the nominal conditions, is presented. The software language is FORTRAN, and the simulation code is composed of approximately 250 subroutines, and most of the subroutines are composed of 10 lines.