An advanced mathematical model of flow and heat transfer in an oscillating heat pipe (OHP) is proposed. The capillary and gravitational forces are included in the momentum equation of the liquid slug. Detailed numerical simulation is carried out to investigate the surface tension and gravity effects on the oscillatory flow and heat transfer  in an OHPs with different inner diameters and orientations. The results show that gravity effect hinders the performance of top heat mode OHP while aids the operation of bottom heat mode OHP. Comparisons between the cases with surface tension and without surface tension indicate that the effects of surface tension on the performance of OHP is negligible even for small inner diameter. The effect of inclination angle on the performance of OHP is investigated.