Vietnam is a long coast country with high potential for wind energy development. However, the cost for wind farm project is a big challenge for the power system planning, while the location and capacity of the wind turbines have the large impact on the operation efficiency of the wind farm. Therefore, problem of optimal placement and size of wind farm attracts great interest of the practitioner and researchers. In this paper, the particle swarm optimization algorithm has been applied to optimize the placement and sizing of wind farm. The model has been tested on the simplified Vietnamese power system to determine the optimal location as well as installation capacity of the wind farm in order to minimize system operation cost while ensuring the capacity limit of transmission lines, power balance, and other constraints. The results in the paper can be applied for power system planning, design, and wind farm projects