A common assumption in basic heat exchanger design theory is that fluid is distributed uniformly at the inlet of the exchanger on each fluid side and throughout the core. However, in reality, uniform flow distribution is never achieved in a heat exchanger and is referred to as flow maldistribution. Flow maldistribution is generally well understood for the macrochannel system. But it is still unclear whether the assumptions underlying the flow distribution in conventional macrochannel heat exchangers hold good for microchannel system. In this regard, extensive numerical simulations are carried out in a “U” type parallel microchannel system in order to study flow and heat transfer maldistribution and validated with in-house experimental data. A detailed parametric analysis is carried out to characterize flow maldistribution in a microchannel system and to study the effect of geometrical factors such as number of channels, n, Area of cross section of the channel Ac, manifold cross section area Ap, and flow parameter such as Reynolds number, Re, on the pressure and temperature distribution. In order to minimize the variation in pressure and to reduce temperature hot spots in the microchannel, a response surface based surrogate approximation and a gradient based search algorithm are used to arrive at the best configuration of microchannel cooling system. A three level factorial design involving three parameters namely Ac/Ap, Re, n are considered. The results from the optimization indicate that the case of n = 7, Ac/Ap = 0.69, and Re = 100 is the best possible configuration to alleviate flow maldistribution and hotspot formation in microchannel cooling system.