Background The design of an improved nuclear fuel pellet for use in the Westinghouse AP1000 reactor that is more powerful than existing pellets, is less expensive to manufacture, and meets Nuclear Regulatory Commission requirements for certification was undertaken to complete a senior design course in the ABET-certified nuclear engineering curriculum of Rensselaer Polytechnic Institute, Troy, NY. Methods The modeling team selected the Monte Carlo N-Particle (MCNP) program for assessing how well the pellet design achieves a k-effective value of 1, designed the base model consisting of a fuel pin inside a boron-water moderator with reflector, and ran MCNP tests on the base pellet. The design team modified the base pellet and tested it at different uranium-235 enrichments, with void spheres of varying volume and silicon carbide inclusions in the void volume. The simulation team selected K-code for testing the fuel pellets. The economics team analyzed the cost of manufacturing the improved pellet from cost of raw material through its tail assay in the form of Separative Work Unit (SWUs). The impacts team researched environmental, societal, governmental, political, and public affairs aspects of nuclear fuel production. Results Multiple configurations of uranium enrichment and silicon carbide volume inclusions in the nuclear fuel pellet achieved a k eff of 1, and the price per pellet, assuming fabrication costs comparable to existing manufacturing processes, was reduced by as much as about 50% when the volume of uranium oxide replaced by silicon carbide is 0.27 cm3. At smaller replacement volumes, the price per pellet is reduced by as little as 5%. Conclusions The goal of designing an optimized fuel pellet was met. Replacing a 0.27 cm3-volume sphere of uranium oxide with silicon carbide from the center of a pellet of 4%, 5%, or 6% uranium-235 enrichment reduced the cost of the pellet by approximately 50%.