Speed reducers incorporating cycloidal technology as their primary reduction mechanism have always been active topics of research given their unique trochoidal tooth profile. A cycloidal reducer is recognized for its strength andmainly studied for rotational performance improvement. Nowadays@ this study can be performed by digital prototyping@ which has become a valuable tool for simulating exact scenarios without experimenting on actual model. This paper discusses the stress distribution@ modeled in a dynamic simulation environment@ on the rotating parts of Cycloidal reducer. A three dimensional finite element model is developed using Algor FEA commercial code to simulate the combined effect of external loading and dynamic as well as inertial forces on one--cycloid disc system. This model utilizes surface--to--surface contact to define interaction between rotating parts of the reducer assembly. The results are analyzed for the variation in stress and deformation with respect to time for a certain simulation period. This study gives an insight of internal load sharing of rotating parts and their capability of carrying shock loads.