Optimal placement and sizing of DG in distribution network is an optimization problem with continuous and discrete variables. Many researchers have used evolutionary methods for finding the opti-mal DG placement and sizing. This paper proposes a hybrid algorithm PSO&HBMO for optimal placement and sizing of distributed generation (DG) in radial distribution system to minimize the total power loss and improve the voltage profile. The proposed method is tested on a standard 13 bus radial distribution system and simulation results carried out using MATLAB software. The simulation results indicate that PSO&HBMO method can obtain better results than the simple heuristic search method and PSO algorithm. The method has a potential to be a tool for identifying the best location and rating of a DG to be installed for improving voltage profile and line losses reduction in an electrical power system. Moreover, current reduction is obtained in distribution system.