It has become critical to optimize process and systems in order to reduce energy consumption and the environmental effect, while increasing the productivity and product quality. Thermal systems, which are based on heat and mass transfer, fluid flow and thermodynamics, arise in a wide variety of applications and it is particularly important to optimize these. This presentation discusses the optimization of thermal systems and processes in order to achieve the best output with respect to energy and the environment. Systems from several important application areas, such as manufacturing, thermal management of electronics, heating/cooling and heat rejection are considered. Thermal systems and processes are generally quite complex due to variable material properties, uncertainties, combined transport mechanisms, complex domains, complicated boundary conditions, and multi-scale phenomena. Therefore, the modelling and simulation of these systems is quite involved and considerable care is needed to obtain accurate results. Simulation results, along with experimental data, are used for prediction of the behaviour of systems, as well as their design and optimization. The paper focuses on the reduction in energy and material consumption and in the effect on the environment. However, it is also important to enhance the output and improve the quality of the product obtained. The important aspects that must be considered and the approaches that may be adopted to obtain an accurate model and an optimal design are discussed in detail. In most practical situations, several objectives are of interest and multi-objective design optimization is necessary. Results for a few important systems, such as those for power plant heat rejection, materials processing and thermal management of data centres, are presented in order to illustrate the basic approach. Additional concerns and approaches are outlined for other important processes.