Adding an exit diffuser is known to allow wind turbines to exceed the classical Betz-Joukowsky limit for a bare turbine. It is not clear, however, if there is a limit for diffuser-augmented turbines or whether the structural and other costs of the diffuser outweigh any gain in power. This work presents anew approach to the aerodynamic optimization of a wind turbine with a diffuser. It is based on an extension of the well-known Blade Element Theory and a simple model for diffuser efficiency. It is assumed that the same conditions for the axial velocity in the wake of an ordinary wind turbine can be applied on the flow far downwind of the diffuser outlet. An algorithm to optimize the blade chord and twist angle distributions in the presence of a diffuser was developed and implemented. As a result, an aerodynamic improvement of the turbine rotor geometry was achieved with the blade shape sensitive to the diffuser speed-up ratio. In order to evaluate the proposed approach, a comparison with the classical Glauert optimization was performed for a flanged diffuser, which increased the efficiency. In addition, a comparative assessment was made with experimental results available in the literature, suggesting better performance for the rotor designed with the proposed optimization procedure. (C) 2016 Elsevier Ltd. All rights reserved.