The study of the steady state and stability characteristics including whirl instability of finite two-lobe hybrid journal bearing with an axial groove, located at the top from which oil is supplied at a constant pressure is obtained theoretically. The two lobes of 1600 arc each are separated by two axial oil groove of 20° circumferential extensions in the horizontal direction. A two-dimensional finite difference solution was used to predict the performance of finite length externally pressurized two-lobe hydrodynamic hybrid journal bearings.The Reynolds equation is solved numerically using finite difference method satisfying the appropriate boundary conditions to obtain the effect of speed parameter on bearing performance.The stability characteristics were found out using first-order perturbation method. With the change of speed Stiffness and damping coefficients behaviour was determined at various eccentricity ratios. The bearing load-carrying capacity, stiffness, lubricant flow rate, attitude angle and frictional torque due to bearing rotation increase with increase in eccentricity ratio and speed. A comparison is also made with plain cylindrical axial grooved journal bearing. It is found that externally pressurized two-lobe hybrid bearing is more superior to plain cylindrical axial-grooved oil journal bearing in terms of load capacity, improved end flow, friction losses and stability. The bearing is generally stable at high values of the eccentricity ratio and speed parameter.