Optimization and reliability assessment of water distribution networks (WDN) are complicated processes. Because of this, most of the researches focused only on the pipes without considering other network components such as the tanks in the both processes. Despite the benefits that the tanks may bring, WDN are usually designed without incorporating the tanks in the optimization process or in reliability considerations. This research aims generally to optimize and assess the reliability of WDN, and specifically to incorporate the demand balancing tanks in the optimization and reliability assessment process and also find out their influence on the total cost and reliability of the network. The research has been carried out by developing a new decision support tool; NORAT (Networks Optimization and Reliability Assessment Tool). NORAT consists of two separate models; network optimization model (NetOpt model) and network reliability assessment model (NetRel model). The hydraulic analysis in both models is performed by integrating the EPANET programmer's toolkit functions. NetOpt model determines the required tank volume, optimizes the pipe diameters and tank elevations, and finally calculates the total cost of the optimized network. The optimization is based on minimizing the cost of the network and constrained by the minimum nodal pressure, maximum pipe unit headloss and tank inflow/outflow that preserve the demand balance. The used optimization approach is EO (Keijzer et al., 2008) which is an unconstrained single-objective GA optimization algorithm. On the other hand, NetRel model assesses the hydraulic reliability of the network using three indices; available demand fraction 'ADF' (Ozger and Mays, 2003), network buffer index 'NBI ' (Trifunovic, 2012) and network resilience 'In' (Prasad and Park, 2004). The model also determines the network hydraulic performance (nodal pressures and demands, and links flow, velocity and headloss) in the normal supply conditions while analyzing the network by both demand-driven (DD) and pressure-driven demand (PDD) simulation. The PDD simulation is performed using the PDD model of Pathirana (2010).NORAT has been applied to 102 network variants with different topographic terrains, different network schemes and different water source and tank locations. The application results have shown that it is difficult to adapt a general pattern demonstrating the relationship between the network total cost and its reliability in all cases, as this depends mainly on the network properties. The results have shown also that incorporating the demand balancing tank at the appropriate location can decrease the total cost and increase the reliability of the network. On the other hand, NORAT application proved that it is able to involve the demand balancing tanks in both the optimization and reliability assessment processes. The application also proved that NORAT is a reliable and robust decision support tool providing full assessment and helping to trade off between the available design alternatives and draw the conclusion about the best one by the compromise between the reliability and the total cost