This paper introduces a solar-assisted ground-coupled heat pump (SAGCHP) system with heat storage for space heating and domestic hot water (DHW) supply. The simulation results of the system's detailed operating performance are presented. The optimization of the system design is carried out by the TRNSYS and a numerical simulation is performed for continuous operation of 20 years under the meteorological conditions of Beijing. Different control strategies are considered and the operational characteristics of each working mode are studied. The simulating results show that the long term yearly average space heating efficiency is improved by 26.3% compared to a traditional ground coupled heat pump (GCHP) system because the solar thermal collecting system is used to elevate the thermal energy in the soil and to provide direct space heating with heat storage. At the same time, the underground heat load imbalance problem for a heating load dominated GCHP is solved by soil recharging during non-heating periods, while extra solar energy is utilized to supply DHW. The flexibility and high efficiency of the SAGCHP system could offer an alternative for space heating and DHW supply by heat pump technology and solar energy in cold winters of northern China. (C) 2011 Elsevier B.V. All rights reserved.