The objective of this thesis is to enhance the efficiency of Mass Rapid Transit (MRT) system and improve the power quality by reducing harmonic distortion. The energy consumption of an MRT system by considering the annual ridership and the stochastic operation characteristics of train sets are used to find the optimal placement of traction substations to enhance the operation efficiency of MRT systems. To mitigate the harmonic distortion, the installation location and capacity of harmonic filters are designed and verified by computer simulation. The software programs for AC/DC load flow study and harmonic distortion analysis have been developed and integrated to perform power system simulation of MRT operation. The mathematical model of 12-pulse uncontrolled rectifiers without interphase transformers is derived and implemented in the programs to obtain more accurate simulation results. The optimal inverter substation planning is solved by minimizing the overall cost of power consumption and inverter investment for mass rapid transit power systems with immune algorithm. The objective function and constraints are expressed as antigen, and all feasible solutions are expressed as antibody. The diversity of antibody is then enhanced by proximity of antigen so that the global optimization during the solution process can be obtained. It is found that the energy regeneration can be restored effectively with the optimal planning of inverters by the proposed immune algorithm. Based on the computer simulation of Taipei MRT system, the voltage harmonic distortion is varied dramatically with the dynamic load behavior of train sets. The stochastic harmonic load flow analysis is performed to investigate the power quality problem for an electrified rapid transit system. Different strategies of harmonic distortion mitigation have been proposed by minimizing the objective function to solve the optimal sizes and locations of harmonic filters so that the harmonic distortion can be reduced and reactive power compensation can be obtained at the same time. By performing the immune algorithm, the harmonic filters with proper capacity and the corresponding switching time for filter commitment are determined. It is found that the harmonic distortion can be effectively reduced for the MRT system by the proper design of harmonic filters.