The present study was aimed at developing a model to optimize the sizing parameters and farm layout of wind turbines according to the wind resource and economic aspects. The proposed model, including aerodynamic, economic and optimization sub-models, is used to achieve minimum levelized cost of electricity. The blade element momentum theory is utilized for aerodynamic modeling of pitch-regulated horizontal axis wind turbines. Also, a comprehensive cost model including capital costs of all turbine components is considered. An iterative approach is used to develop the optimization model. The modeling results are presented for three potential regions in Iran: Khaf, Ahar and Manjil. The optimum configurations and sizing for a single turbine with minimum levelized cost of electricity are presented. The optimal cost of energy for one turbine is calculated about 46.7, 54.5 and 46.6 dollars per MW h in the studied sites, respectively. In addition, optimal size of turbines, annual electricity production, capital cost, and wind farm layout for two different rectangular and square shaped farms in the proposed areas have been recognized. According to the results, optimal system configuration corresponds to minimum levelized cost of electricity about 45.8 to 67.2 dollars per MW h in the studied wind farms. (C) 2013 Elsevier Ltd. All rights reserved.