Abstract: A design optimization system and method includes recursive evaluation of a system model and/or a set of subsystem models using subsystem design(s) to extract interactions and perform subsystem design optimization. Selective update of the boundary conditions occurs according to: u ^ subsystem ? ? ? ( i ) = ? s = 1 k ? w ~ s ? u ^ s ? ? ? on ? ? ? ? subsystem ? ? ? ( i ) where ûs(x,y,z,t) are the interactions between subsystems and/or between the system and its subsystem(s) on ?subsystem(i) at iteration s, and {tilde over (w)}s(x,y,z,t) are weight functions whose spatial and temporal distributions are predetermined and whose magnitudes are varied stochastically within a selected range.