Network reconfiguration is an operation problem, which entails altering the topological structure of the distribution feeders by rearranging the status of switches in order to obtain an optimal configuration in order to minimise the system losses. This paper presents a new reconfiguration algorithm that enhances voltage stability and improves the voltage profile besides minimising losses without incurring any additional cost for installation of capacitors, tap changing transformers and related switching equipment in the distribution system. Test results on a 69 node distribution system reveal the superiority of this algorithm. © 2009 Elsevier Ltd. All rights reserved.