Abstract: Based on the sitting and sizing of distribution generation, the function of reactive power optimization is added to improve the voltage level of power grid and reduce the loss of line. Based on the distribution generation supply, the problem of sitting and sizing of distribution generation are decomposed into grid-connected and resection models of DG by considering of reactive power optimization. The two models are the comprehensive optimization of distribution network loss, voltage deviation and voltage stability margin with DG full power output and the least distributed network loss under constraints of qualified voltage level with zero DG power output. Then multiple objectives are converted into a single objective through the weighted method. By taking 33 nodes distribution system as example, analysis is carried out on distributed system by immune algorithm, which proves the advantages of sitting and sizing of distribution generation by considering reactive power optimization. Through analyzing the optimization results of reactive power optimization and the sitting and sizing of distribution generation, the best result can obtain by considering of both aspects.