Factory and facility automation has been widely implemented since the revolution of computers. A variety of automatic material processing machines and material handling equipment have been designed and manufactured for various applications. The facility layout optimization is one of the major tasks in designing automated systems. This paper proposes a generic methodology that provides a systematic way to design an optimal layout for all types of automated facilities. The quantitative design criteria of automatic material processing machines and material handling equipment are addressed first. An optimal connectivity among machines is then solved through topology approach and heuristic algorithm. Thus, an optimized facility layout can be derived and completed by combining the optimal topology connectivity, physical constraints, and designer's preference.