Incorporating the mechanistic model for oxygen reduction at YSZ/LSM interface, a complete micro-model for YSZ/LSM composite cathode considering all forms of polarization was developed which established the interrelationship among the transport phenomena, electrochemical processes and the microstructure of the composite cathode. The exchange current densities of the rate-limiting steps used in the simulation were obtained by fitting the proposed mechanistic model to the DC polarization curves. Simulation was conducted to predict the optimal design parameters, e.g. cathode thickness, particle size, particle size ratio and YSZ volume fraction, for a LSM/YSZ composite cathode. Except for the YSZ volume fraction beyond the percolation thresholds, the predicted results seem to be in good agreement with the experimental and literature data. Incorporating with reliable experimental data, the model can be used as a tool to guide the design of high performance cathodes. (C) 2004 Elsevier Ltd. All rights reserved.