There have been many experimental and observational evidences which indicate the predator response to prey density needs not always monotone increasing as in the classical predator-prey models in population dynamics. Holling type functional response depicts situations in which sufficiently large number of the prey species increases their ability to defend or disguise themselves from the predator. In this paper we investigated the stability and instability property for a Holling type predator-prey system of a generalized form. Hopf type bifurcation properties of the non-diffusive system and the diffusion effects on instability and bifurcation values are studied.