Prospects of laser operation in erbium doped silicon has been analyzed by a Shockley-Read-Hall (SRH) model. Erbium atoms have been considered to be introducing strong recombination centers in the silicon lattice. Electron-hole recombination at these sites were considered to be the source of erbium excitation. A two level system was considered for calculation of optical gain and the laser threshold. For a laser cavity of 300 μm with mirror reflectivities of 90%, and an optimistic absorption coefficient of 5 cm-1, a population inversion of 1.4×1018/cm3 was estimated as the threshold value. Achievement of the lasing condition was found feasible, but only for certain conditions of erbium activation. Effects of nonradiative deexcitation routes have been analyzed. On the assumption of 1019/cm3 of active erbium sites, linear increase of optical power in the laser cavity has been estimated for injected carrier densities above 1018/cm3.