An on-line, digital data handling and optimal control system based upon a PDP8s, general purpose, programmable digital computer, has been developed and tested at the Missouri University Research Reactor (MURR), a 5 megawatt, thermal, flux-trap type nuclear reactor. The instrumentation which has been successfully interfaced to the small digital computer includes a 100 channel, 250 Hz, randomly addressable reed scanner; a 10-bit, 100 kHz, analog-to-digital converter; a 60 Hz real time clock which provides a hardware interrupt every 16.7 milliseconds; and two relay contact outputs. Software which has been implemented includes a real-time executive which schedules eight different tasks in a specified priority and periodic scheme, a console utility package which allows direct, on-line, communication between computer core memory and the ASR-33 teletype, an analog signal input task, various control algorithms, an output task, and a systems log task. The automatic control algorithms are dependent upon the physical parameters of the reactor system. These parameters may be periodically identified by on-line dynamic testing and the control decision algorithm may be modified accordingly. Methods of z-transform analysis are applied in a linearized approach to the problem of representing each component of the closed-loop reactor, computer control system. The optimization theory based on the maximum principle of L. S. Pontryagin has been applied in an effort to improve the control calculations with respect to minimum time response. Testing methods used were hybrid computer simulation and on-line parameter input studies at the MURR.