The effects of machine breakdowns on the performance of the manufacturing systems can be grouped into two main categories, the cost-based effects, namely machine repairing or replacing costs and the time-based effects, i.e. delay in due dates. Usually, it is difficult to handle machines breakdowns as quickly as the production requirement dictates and hence, machines’ reliability may be considered as a key assumption in designing manufacturing systems. We present a multi-objective model for the generalized cell formation problem with machine reliability consideration. The proposed model tries to model the various effects of the machine breakdowns. As the proposed model is a bi-objective one, we introduce a multiobjective memetic algorithm to acquire the efficient solutions. Using some numerical examples, we compare the performance of the proposed algorithm with an exact algorithm, namely the є-constraint method. The results show that the proposed memetic algorithm can be as effective as the є-constraint method in much less computational time.