There is provided a method and apparatus for monitoring oil deterioration in real time. The method includes the steps of radiating light into an oil medium and measuring light intensities at red, green and blue wavelength ranges of the light after passing through a certain thickness of the oil. A ratio of the light intensity at the red wavelength range to the light intensity at the green wavelength range is computed by using the measured light intensities. These steps are repeated to monitor a change in the above ratio value in real time of oil use. The apparatus includes a light source means for radiating light into an oil medium, a color sensing means for measuring light intensities at red, green and blue wavelength ranges of the light that has passed through a certain thickness of the oil, and a control means for computing and monitoring a ratio of the light intensity at the red wavelength range to the light intensity at the green wavelength range, using the light intensities measured by the color sensing means.