AbstractThe physics and engineering optimization studies are carried out for continuous-coil or modular-coil helical reactors based on the large helical device (LHD) concept. Especially, the physics optimization of the modular heliotron reactor (MHR) concept with a well-defined and efficient closed helical divertor has been carried out, and the effectiveness of this new modular-coil system and its magnetic configuration are clarified. The engineering optimization studies of this MHR are also carried out using simplified scalings, and the required machine parameters for DT ignition reactors are clarified. Two reactor design candidates (the standard and compact designs) are selected, and the present cost analysis suggests the effectiveness of the compact design option.