In this thesis, a technique has been established for solving best distribution networkrnreconfiguration with better placement of Distributed Generation (DG) to reduce power lossrnand to improve the voltage profile in the Addis west distribution system. rnIn the proposed method, a radial distribution power flow of the Addis West (ADW) isrnsimulated for the developed radial distribution network power flow using Newton-Raphsonrn(NR) method. Then an extensive network reconfiguration is performed on the developedrnradial distribution network using the Particle Swarm Optimization (PSO) algorithm. ArnMATLAB code is developed to determine the best reconfiguration and compare it with thernoriginal configuration in terms of voltage profile and total real power loss. Furthermore, arnDG inserted version of the original configuration has been compared with the originalrnconfiguration for its voltage profile as well as the total real power loss. DG size and locationrnare determined using loss sensitivity factors with the forward-backward algorithm torncalculate total power loss of the network and to identify the node loss sensitivity factors. rnDuring simulation of the network reconfiguration, switches 34, 41, 52, 66 and 81 are foundrnto be open while the rest of the switches are closed. Moreover, the suitable site and size ofrnDG are found at bus numbers 45 and 57 with suitable size of 1.903 MW and 2.713 MWrnrespectively. The real power loss in the network after reconfiguration with DG is reduced byrn60.733% (i.e. 1146 kW to 450 kW). The minimum bus voltage is increased from 0.8491 p.urnto 0.965 p.u. The total cost of the determined DG size was carried out by considering thernsteam-turbine DG type. Consequently, the total cost of the 4.616 MW DG installation isrnfound to be $3,092,720 with its payback period of 9.3 years. Hence, the results show that therncombination of network reconfiguration with the DG installation method in the distributionrnsystem is more effective in power loss reducing and improving the voltage profile of thernsystem.