The purpose of this work is to investigate (1) the effect of thermal discharge from power generating plants on the stream water quality, and (2) the installation of the artificial aerators for water quality control of a stream which receives thermal and organic waste discharges by means of computer simulation and optimization. An energy balance equation is formulated to describe the temperature distribution along the stream which receive thermal discharge. The equation is based on heat transfer mechanisms which include short-wave and long-wave radiation, evaporation, and convective heat transfer. The water quality of stream, as characterized by variations of DO and BOD concentrations, is represented by the modified Streeter-Phelps equations. The temperature dependency of BOD removal coefficient, saturation DO concentrations, time-smoothed photosynthesis minus respiration, and natural reaeration coefficient is considered.