Membrane distillation (MD), which can utilize low-grade thermal energy, has been extensively studied for desalination. By incorporating solar thermal energy, the solar membrane distillation desalination system (SMDDS) is a potential technology for resolving the energy and water resource problems. Small-scale SMDDS (s-SMDDS) is an attractive and viable option for the production of fresh water for small communities in remote arid areas. The minimum-cost design and operation of s-SMDDS are determined by a systematic method, which involves a pseudo steady state approach for equipment sizing and the dynamic optimization using overall system mathematical models. The s-SMDDS employing three MD configurations, including the air gap (AGMD), direct contact (DCMD) and vacuum (VMD) types, are optimized. The membrane area of each system is . The AGMD system operated for 500 kg/day water production rate gives the lowest unit cost of . The performance ratio and recovery ratio are 0.85 and 4.07%, respectively. For the commercial membrane employed in this study, the increase of membrane mass transfer coefficient up to two times is beneficial for cost reduction and the reduction of membrane heat transfer coefficient only affects the cost of the DCMD system.