The escalating energy crisis and environmental issues have compelled countries worldwide to advance energy transitions and vigorously develop green and clean energy technologies. External combustion devices can effectively utilize hydrogen-based fuels, biomass, solar energy, and other sources, playing a critical role in achieving carbon reduction. As a type of external combustion device, the free-piston Brayton generator, with its strong energy adaptability, stands as a highly promising power generation device. Therefore, the design optimization methods and operational characteristics of the free-piston Brayton generator system are worthy of thorough investigation. This paper introduces a novel method for constructing and structurally optimizing a free-piston Brayton generator model. Sage software is utilized to construct a closed-loop free-piston Brayton generator system in the time domain, followed by numerical analysis. The results show that within the frequency range of 35 ∼ 80 Hz, the system maintains a thermal-to-electric efficiency exceeding 40.00 %, demonstrating the system’s ability to operate efficiently at high frequencies. The piston diameter influences the dynamic behavior of the system’s piston, emphasizing the necessity of gradually adjusting the piston diameter to achieve optimal efficiency during structural parameter optimization. System efficiency and power can be balanced by adjusting the compressor inlet pressure. Under design conditions, the system can output 2046 W of electrical power. The thermal efficiency and thermal-to-electric efficiency are 46.84 % and 41.36 %, respectively. Additionally, an innovative analysis of the temperature distribution of the system and the distribution of exergy losses in major components under conditions of high frequency and small piston displacement is conducted. This work provides a new method and guidance for the subsequent design and optimization of free-piston Brayton generators.