The air cycle machine (ACM) is a sub-system of the passenger air conditioner (PACK) system, its key function is to enable refrigeration of the air in order to comply with the wide-range of cabin environment requirements for maintaining safety and comfort of the aircraft and passengers. The operation of the ACM is governed by the PACK control system which has the ability to mask degradation in its component during operation until severe degradation or failure results. The required maintenance is then both costly and disruptive. The ACM has been reported as a major driver of unscheduled maintenance. In this paper a verified and validated PACK simulation model has been implemented to conduct simulation of degraded ACM components in a representative Boeing 737-800 model. The fault modes of interest are those highlighted by the operators and correspond to the ACM compressor, turbine and interconnecting mechanical shaft efficiency degradation. Simulation results, in terms of temperature, pressure and mass flow at various degradation severities, are presented for each component at system level. The acquired results suggest that, for all three fault modes, the PACK controller has the ability to compensate for an ACM degradation severity of up to 20%, allowing it to sustain the delivery of the demanded temperature and mass flow. For degradation severity beyond 20%, the PACK is able to deliver the demanded temperature with substantially reduced mass flow. This has a significant impact on the PACK's ability to meet the cabin demand.