Multi-stage desiccant systems are an effective way to improve the performance of desiccant dehumidification systems, which can greatly decrease the required regeneration temperature and make possible the utilization of exhaust heat from the heat pump. The performance of a heat pump-driven two-stage desiccant wheel system is analyzed in this paper. Models of the desiccant wheel and heat pump systems are utilized to predict system performance. The effects on system performance of the compressor power input, the heat exchange area distribution between evaporators and condensers, the wheel's rotation speed, and the inlet parameters of the processed air are investigated. When the supplied air humidity ratio is 10 g/kg, COPt of the desiccant system is 5.5 under Beijing summer condition. The key to improving system performance is to match the cooling capacity and exhaust heat provided by the heat pump with the requirements of dehumidification and regeneration. An improved system utilizing an indirect cooler to recover the cooling capacity from the indoor exhaust air is then proposed, with COPt improving by 15% compared to the original system. (C) 2013 Elsevier Ltd. All rights reserved.