Advances in low cost digital computing have spawned new design techniques. One of these, design optimization by adaptive control (DOAC), is explained. Modeling an entire system to optimize one component has many disadvantages. When using the ideas presented here, a component is removed from a physical system and replaced with a minicomputer, D/A and A/D hardware, transducers, and an adaptive simulation algorithm.The adaptive algorithm can then optimize the component design using real time performance data. An example implementation dealing with a small reciprocating internal combustion engine, and some possible future applications, are discussed.