The adaptation of annular thermoelectric generator (ATEG) to cylindrical heat sources exhibits a better performance compared to widely studied flat plate type thermoelectric generator (FTEG). To enhance heat transfer and improve the overall performance, a novel structure of the heat exchanger of the twisted-tape annular thermoelectric generator (TT-ATEG) is proposed in this paper. A three-dimensional finite element model of TT-ATEG is established for the first time. The net power gain coefficient and the efficiency gain coefficient are defined to quantify the performance of TT-ATEG, and the gain effects of the length, twist ratio and radius of the twisted tape are analyzed respectively. To maximize the comprehensive performance of TT-ATEG, the optimal weighting factor of net power and efficiency are determined, and the full-parameter optimization of the twisted tape is completed. The results reveal that the optimal performance of TT-ATEG is obtained if the weight ratio of net power and conversion efficiency is 1:4. In our case study, dimensionless factors radius ratio Rr, length ratio Lr and twist ratio of the twisted tape are 0.714, 0.479 and 136.84 respectively. Compared with the ATEG without twisted tape, the net power and efficiency are improved by 10.41% and 22.51%, respectively. The results demonstrate that the novel design of TT-ATEG could accelerate the heat transfer effectively and enhance the overall performance.