Summary: This paper strives to derive the analytical solutions for the dynamic analysis of stepped multi-span rotor system, where the rotating shaft’s internal damping effect is also considered. Specifically, the steady-state whirl analysis and free vibration analysis is given herein. For the steady-state whirl analysis, firstly, the stepped shaft is spilt to several uniform segments and their governing equations are established by Hamilton principle. Subsequently, by applying variable separation method and Laplace transform method to each segment’s governing equation, their steady-state responses in terms of determinate interpolation functions multiplied by unknown boundary constants are derived. Then based on the transfer matrix method, each segment’s boundary constants are determined with consideration of the compatibility conditions of each two adjacent segments and the end boundary conditions. For the free vibration analysis, one only need to remove the forced term in the steady-state form of transfer matrix and the rotor’s characteristic equation will be obtained. Through the theoretical derivation, it is found that this analytical approach can be generalized to any isotropic elastic boundary conditions. To validate the proposed method, two case studies are proposed, where the finite element method is used as benchmark method. For the first one, the influence of internal damping on a uniform rotor’s damped whirl characteristics and its stability is analyzed. The damped whirl characteristics analysis reveals that viscous internal damping result in the destabilization of forward modes as long as the spinning speed becomes higher than the critical speed. This phenomenon is also demonstrated by the time responses analysis. For the second one, the dynamic responses of a two-span three steps rotor-bearing system with isotropic viscoelastic boundary conditions are determined. All of simulated results show a great agreement between analytical results and FEM results.