This study presents a dynamic and reliability analysis of underground tunnels subjected to internal blast loading. Finite element analysis is conducted using ABAQUS 6.14, with the Drucker-Prager elasto-plastic model for soil and the Von Mises elasto-plastic model for the cast-iron tunnel lining. A New York City subway soil profile is considered, with the tunnel embedded in saturated clay. Blast loads of 10, 30, 50, and 75 kg TNT are analysed. Reliability analysis is performed using the First Order Second Moment (FOSM) method, assuming normally distributed load and capacity. The probability of failure is calculated based on variations in lining thickness, tunnel diameter, and blast location. Results indicate that increasing tunnel lining thickness improves the reliability index and reduces failure probability. For a 4 m diameter tunnel, the reliability index decreases from 3.01 at 10 kg TNT to 0 at 75 kg TNT, while a 5 m tunnel retains a reliability index of 1.15 at 75 kg TNT, ensuring safety up to 50 kg TNT. Blast location significantly influences reliability, with tunnel mouth explosions producing the lowest indices, ranging from 3.01 at 10 kg TNT to 0 at 75 kg TNT. Mid-tunnel explosions result in higher reliability, from 3.42 at 10 kg TNT to 1.15 at 75 kg TNT, making tunnels nearly 100% safe up to 50 kg TNT. These findings provide insights into optimizing tunnel geometry and lining thickness to enhance reliability and structural resilience against internal blasts.