This article presents a thermodynamic analysis for a proposed hybrid system suitable for producing power or fresh water for small communities. The system includes a power generation loop and a desalination loop. These loops can work separately to produce power or combined to produce fresh water. The power loop comprises a solar pond, flashing chamber, vapour compressor VCI, steam superheater, steam turbine and a steam condenser. The desalination loop includes a vapour compressor VCII, vertical tube evaporator unit, multi stag flash feed heater and a heat rejection steam condenser. Hot water from the pond (97°C) is introduced into the flashing chamber and the generated steam is compressed to 125 kPa. Then the steam is superheated (using fuel) to a temperature of 315°C and is allowed to expand in a low pressure steam turbine exhausting into a condenser at 10 kPa. The turbine & VCI are mounted on the same shaft and the balance in the power generated can be used either as shaft power available or specifically for driving a desalination loop. This could be either a reverse osmosis RO or a vapour compression system. However, the analysis showed that the second one is more efficient than the RO. The VCII, driven by the turbine, is working across a 3-VTE multi effect unit associated with a 13-stage MSF feed heater coupled with an end condenser at 10kPa. Calculations showed that the power loop of a 100 m × 100 m solar pond assisted by 13 percent of its heat requirements, using fossil fuel, can generate 70 kW shaft power with a basic efficiency of 15%. When this loop is combined with a VC/VTE-MED unit a 200 t/day of fresh water can be produced at a PR of 9.4 and a thermal energy consumption (fuel) of 31 kJ/kg water produced which is less than any other system including the RO.