An optimum design has been performed to maximize the total stored energy (TSE) of a hybrid composite flywheel with a permanent magnetic rotor attached inside the flywheel. The flywheel rotor consists of multiple rings of advanced composite materials. A structural analysis has been performed considering ring-by-ring variation of material properties. The pressure from the centrifugal forces of the magnet is also considered together with the centrifugal body forces in the flywheel rotor. The size of the magnet is dependent upon the required induced voltage, and effects the pressure distribution at the inner surface of the composite rotor. An analytical solution for each ring has been obtained and expressed in terms of a symmetric stiffness matrix. Using the stiffness matrix the continuity conditions can be easily considered and a global system of equations is derived. Displacements are then obtained by solving the global stiffness matrix, and the stresses in each ring are also calculated. 3-dimensional intra-laminar quadratic Tsai-Wu criterion for the strength analysis is used yielding the strength ratio for each ring. An optimum design is thus performed maximizing TSE with the size of the magnet and the thickness of each composite ring as design variables. For that purpose, the sensitivities of TSE and the strength ratios with respect to the design variables are derived by using the global stiffness matrix and the relationship of the magnetic size and the induced voltage. As a result, the effects of material sequence in the hybrid composite flywheel show that the stresses in a rotor can be tremendously reduced by fabricating the rotor in multiple rings with the stiffness of the rings increasing with radius. The optimal design using hybrid composite materials has attained about 2 times the total energy of cases of using each material alone.