It is a challenge to prevent occupational accidents in any industrial activities. The aim of this study is to improve safety and reduce the risk of occupational accidents at shipyards by developing a risk assessment methodology using work observation technique. This article describes a concept and methodology of risk assessment for occupational safety and its application. It introduces an effective and useful assessment procedure designed from a database based on the past cases of occupational accidents at shipyards. A quantitative method is developed to understand unsafe working conditions and environment at shipyards. A mobile device is used to collect the work observation data at the shipyard, and some examples of effective hazard measures are suggested. Based on the methodology, a feasibility study was conducted to improve walking safety at a numerical control (NC) cutting process of a shipyard in Japan.