Abstract: Capacitors in power systems are generally used to supply reactive power for the purpose of loss minimization and voltage profile improvement. The appropriate placement of capacitors is also important so as to ensure that system power loss and total capacitor costs can be reduced. The main objective of this study is to determine optimal placement of capacitors so as to reduce the power loss and improve the voltage profile. Presently, the capacitor placement problem is widely solved by using heuristic optimization methods. In this study, the Harmony Search (HS) algorithm which is a relatively new meta-heuristic method is applied to solve the optimal capacitor placement problem. An effective and simple power flow method based on the backward/forward sweep power flow is also employed for the power flow simulations. The performance of the proposed HS algorithm is validated on the 9 and 34-bus radial distribution systems and the obtained capacitor placement results using HS are compared with other optimization methods.