For marine vessels, a propeller shaft system, also known as a propulsion shaft system, is an essential changer in engine torque and propeller thrust. The propeller shaft system is subjected to transverse, longitudinal, and torsional excitations during operation. These sources of excitations originate from alternating thrust generated by the propeller, operation of a propeller in a stern flow field which is non-uniform in time and space, misalignment of components such as shafts, bearings, and keyholes in the assembly, excitations in the form of rotational motion, and the whirling motion of the shafts. These dynamic excitations posed a challenging issue for the integrity and reliability of a marine vehicle. Thus, it is crucial to analyze the dynamic response of the propulsion shaft system. The dynamic analysis of the propulsion shaft system is typically conducted using numerical /analytical models. At present, Finite Element Model (FEM) as a numerical model plays a vital role in analyzing the dynamic response of the structure. The computed response and the modal parameters from the FE model are reliable only if accurate boundary conditions, such as stiffness, can be imposed on the model. However, the numerical FE model deviates from the experimental results because of uncertainties in the stiffness values of the bearings and other connectors. This paper uses the Response Surface Optimization (RSO) technique to estimate the unknown stiffness of the bearings used in the propulsion shaft system. The experimental model of the propeller shaft system is constructed from the steady-state response of the system using the step sine excitation. The natural frequencies and the amplitude of vibrations in the FE model are updated using the parametric RSO technique. The updated model shows that the difference in natural frequencies and vibration amplitude is less than 10% between the optimized and experimental models. Propeller Shaft, Vibrations, Optimization, Response Surface