Assessment of overlapped internal and external volumetric flaws is one of the most common problems related to pressure vessel and piping components. Under the current fitness for service rules, such as those provided in ASME, BS, and so on, the procedures for the assessment of these flaws have not yet been defined. In this paper, a reference stress, incorporating the decrease in the effective cross section as a function of flaw depth and flaw angle in a cylinder, has been proposed in order to assess the flaws using the simple (pressure-moment) diagram method. Numerous finite element analyses for a cylinder with overlapped internal and external flaws were conducted to verify the proposed procedure. There is good agreement among them.