A system and method of dynamically managing a power supply allocation for each one of the server blades in a blade server includes a blade server system having a blade chassis, multiple server blades coupled to the blade chassis, a power supply system coupled to the blade chassis, a chassis management module coupled to the blade chassis, wherein the blade chassis includes electrical and data communication interconnections between the server blades, the redundant power supply system and the chassis management module. The chassis management module includes computer readable media having program instructions for dynamically managing a power supply allocation for each one of the server blades.