The objective in designing a new commercial transport aircraft or the upgrading of an existing aircraft is to optimize the design of the aircraft so as to minimize the total cost of ownership for an airline, while meeting the operating requirements. One part of this optimization is the integration of the engine with the airframe. Experience has shown that the optimization of the engine and the airframe as isolated components does not necessarily lead to the optimum system. To obtain the optimum aircraft, the interaction between the engine and the airframe has to be addressed throughout the design process. This paper explores the use of CFD in the aerodynamic design of an engine installation on a commercial transport aircraft from the perspective of the engine manufacturer, although many of the issues are the same for the airframer. The paper begins with a discussion of the aerodynamic design of an engine installation and the identification of the role of CFD in this process. From this discussion it is concluded that the challenge for developers of CFD methods is to produce methods that are accurate and fast enough to be used early in the design process. With the currently available methods it is determined that installation CFD can play an important role in the detailed aerodynamic design of engine installations. The paper concludes with a description of how this has been achieved at GE Aircraft Engines by the use of the Chimera overset grid technique.