As one of many aspects for the competitiveness, proposing a right price to a customer is crucial for a shipyard business. The price may determine whether the shipyard will get profit or losses during a shipbuilding execution. To have a right price, the shipyard should be careful when developing the price constituents. Two of them, that are the main discussion in this master thesis, are production cost and uncertainty.These two constituents are interesting to discuss because according to literature study that preceded this master thesis, it was indicated that there was no researcher studied the uncertainty in cost estimation. To fill this gap, a framework that addresses uncertainties within an estimated cost, is established in this thesis.In the framework, the uncertainty is specifically focused on the driving cost factors that probably occurred during execution. The framework creates a calculation module of incorporating the factors into the element of the estimated cost. From the result, the uncertainty can be analyzed for further mitigation plan. In previous researches, no study has been found discussing driving cost factor within estimated cost. Hence, this framework may be the first calculation procedure which addressing the factors into the shipbuilding cost estimation.As a starting point, a short literature review is carried out to find the possible factors occurred in global shipyards. The list of the factors is then proposed and filtered by a Norwegian shipyard to find the factors that are pertinent. Afterwards, a cost estimation framework is developed by combining several method and procedures, including, successive principle procedure, triple estimation (Low, Most-likely, and High values), and statistical method.Subsequently, an application of the framework is demonstrated. Cost elements in the demonstration refers to SFI grouping system which is a building group classification system for a shipbuilding that is initially established in Norway. Each element has sub- elements (manhour, wage rate, and direct cost) which its value is defined by using triple estimation method. The factors are then incorporated into the cost sub-element in a form of weight of factor, that is derived from multiplication of both weight of its impact and probability. The weight is input as a variance of each sub-element. All sub-elements in every activity are then quantified to find the total cost. Afterwards, all total cost elements are summed up to obtain the grand total cost. The grand total uncertainty is the variance of the grand total cost. After that, the percentage of uncertainty every cost element can be calculated to find an uncertainty distribution within estimated cost. Finally, a mitigation plan is taken here by referring theoretically to the successive principle procedureResults and discussion show that the framework provides a systematic applied formula that effectively address and manage the uncertainty in the shipbuilding cost. This framework is reliable and can be directly applied for cost estimation of actual shipbuilding project.