In this paper, we are concerned with the problem of location of inspection centers in a multistage manufacturing system. A Genetic algorithm based approach is developed to determine the location of inspection centers resulting in a minimum expected total cost. The total cost includes inspection, manufacturing and scrapping cost at each stage of the manufacturing process. A penalty cost is included in it to account for a defective item which is not detected by the inspection scheme. A set of test problems are solved using this algorithm.