Abstract: In this paper, subspace iteration is used to reduce high-order dynamic systems to loworder ones. The Collatz inclusion theorem is extended to Generalized Eigenvalue problems. When the mass matrix or stiffness matrix is positive definite symmetric matrix, the generalized eigenvalue problem is reduced to standard eigenvalue problem by using Cholesky decomposition. The fundamental natural frequency of low-order system is obtained from decomposition of mass matrix and stiffness matrix. To verify the theory, a beam with fixed ends is token as example. The computed result is compared favorably with the exact solution