A hydropower project is the most suitable and effective means to generate electric power at reasonable low cost without harming the environment. One of the most important objectives in planning of hydropower plant for a river valley project is to select the most suitable diameter of penstock pipe. The process of selection of the most suitable diameter needs optimization of penstock diameter under different conditions of flow. The optimization of penstock pipe involves maximizing efficiency of conveyance system of hydropower plant linked between reservoir and turbine. The penstock must be designed to minimize loss of head due to friction and turbulence of water during flow. The condition of flow may be steady state or unsteady state. The diameter of penstock should not be too large which invites operational difficulty and should not be too small, which invites increase in friction loss. The surface roughness of penstock is also an important factor for maintaining turbulence free flow in conveyance system. Pressure variation and friction factor of penstock material must be considered as the decision variables for formulating optimization problem. In this paper, an attempt has been made to optimize the diameter of penstock using Particle Swarm Optimization (PSO).