The integration of cogeneration technologies in residential communities has the potential of reducing energy demand and harmful emissions. This study investigated the impact of selected design parameters on the environmental and economic performances of cogeneration systems integrated into residential communities in cold U.S. climates following a centralized or a decentralized integration approach. Parameters investigated include: 1) density, 2) use mix, 3) street configuration, 4) housing typology, 5) envelope and building systems' efficiencies, 6) renewable energy utilization, 7) cogeneration system type, 8) size, and 9) operation strategy. Based on this, combinations of design characteristics achieving an optimum system performance were identified. The study followed a two-phased mixed research model: first, studies of residential community design and three case studies of sustainable residential communities were analyzed to identify key design parameters; subsequently, simulation tools were utilized to assess the impact of each parameter on cogeneration system performance and to optimize the community design to improve that performance. Assessment procedures included: developing a base-line model representing typical design characteristics of U.S. residential communities; assessing the system performance within this model, for each integration approach, using three performance indicators: reduction in primary energy use, reduction in CO2 emissions; and internal rate of return; assessing the impact of each parameter on the system performance through developing 46 design variations of the base-line model representing changes in these parameters and calculating the three indicators for each variation; using a multi-attribute decision analysis methodology to evaluate the relative impact of each parameter on the system performance; and finally, developing two design optimization scenarios for each integration approach. Results show that, through design optimization, existing cogeneration technologies can be economically feasible and cause reductions of up to 18% in primary energy use and up to 42% in CO2 emissions, with the centralized approach offering a higher potential for performance improvements. A significant correlation also existed between design characteristics identified as favorable for cogeneration system performance and those of sustainable residential communities. These include high densities, high mix of uses, interconnected street networks, and mixing of housing typologies. This indicates the higher potential for integrating cogeneration systems in sustainable residential communities.