A surface panel method for the analysis of ducted propellers in both uniform and non-uniform onset inflow is developed. A low order, perturbation potential based panel method with an efficient numerical Kutta condition is used. The boundary surface is discretized with hyperboloidal panels and the boundary condition is applied at the panel centroids. The unsteady analysis is based on a time-step algorithm in time domain. Numerical implementation is employed into both steady and unsteady problems. The results with the resent method are shown to have good convergence on the circumferential distribution of circulation on the duct. The effect of the propeller tip clearance on the circumferential circulation on the duct is also presented Numerical results on forces and moments of the propeller and the duct are compared with other numerical results and experimental data.