Distribution System expansion planning is a main activity of distribution system utilities in developing countries due to the socio-economic growth results increasing energy demand. Because of the limitations and inefficiency of existing distribution system to handle this ever-increasing electricity demand, efficient distribution system is required. In this study distribution system planning DebreMarkos town will be done by using network reconfiguration and optimal placement of capacitors on the MV distribution network. A Direct Approach Distribution Load Flow Analysis by MATLAB is applied to analyze the existing distribution network system performance with existing demand and future 2032 demand. Based on the system performance, an efficient distribution system is proposed by reconfiguring the existing distribution network. The proposed optimization method is improved particle swarm optimization method. To have an efficient distribution system, feeders are reconfigured by the proposed optimization method. Based on the analysis result; reconfiguration of the distribution network using the proposed BPSO algorithm resulted loss reduction from 973 kW to 650 kW and a significant improvement in voltage profile from 0.79 p.u to 0.86 p.u is obtained. Key Words: Distribution system, Direct Approach Load Flow Analysis, Feeder Reconfiguration, Binary Particle swarm Optimization, MATLAB