Abstract The dynamic stability of Boiling Water Reactors (BWR's) is influenced by the reactor control system and its interaction with external load demand, channel thermal hydraulic properties, and coupled neutronic-thermal-hydraulic dynamics. The latter aspect of BWR stability which is affected by void reactivity feedback, coolant flow rate and fuel-to-coolant heat transfer characteristics is studied in this paper using the normal fluctuation data. The feasibility of overall core stability trend monitoring using neutron noise and the relationship between stability and two-phase flow velocity in a fuel channel are studied. Time series modeling of the average power range monitor (APRM) detector signal, and bivariate analysis of adjacent local power range monitor (LPRM) detector signals are used to determine the neutron impulse response, spectral characteristics and two-phase flow velocity using data from an operating BWR. The results of analysis show that the APRM noise signal can be used to monitor changes in the closed-loop output stability of BWRs (but not the absolute stability as determined by the reactivity-to-neutron power transfer function), and that a positive correlation exists between stability and two-phase flow velocity in a fuel channel. Furthermore, the temporal behavior of the neutron signal for short and long data records indicates that there is no smoothing of the spectral resonance frequency, nor subsequent distortion of the computed decay ratio when long data records were used. The primary perturbation source affecting the void reactivity is being investigated using the relationship between APRM signal and the process variables.