The purpose of this study is to determine the effect of pressure losses and actual heat transfer on the performance of a solar Stirling engine. The model presented includes the effects of both internal and external irreversibilities of the cycle. The solar Stirling engine is analyzed using a mathematical model based on the first law of thermodynamics for processes with finite speed, with particular attention to the energy balance at the receiver. Pressure losses, due to fluid friction internal to the engine and mechanical friction between the moving parts, are estimated through extensive and rigorous use of the available experimental data. The results of this study show that the real cycle efficiency is approximately half the ideal cycle efficiency when the engine is operated at the optimum temperature.