Increasing communication speed requirements have created a great interest in very high speed optical and all-optical networks and interconnects. The design of these optical systems is a highly complex task, requiring the simultaneous optimization of various parts of the system, ranging from optical components' characteristics to access protocol techniques. Currently there are no computer aided design (CAD) tools on the market to support the interrelated design of all parts of optical communication systems, thus the designer has to rely on costly and time consuming testbed evaluations. The objective of the CATO (CAD tool for optical networks and interconnects) project is to develop a prototype of an intelligent CAD tool for the specification, design, simulation and optimization of optical communication networks. CATO allows the user to build an abstract, possible incomplete, model of the system, and determine its expected performance. Based on design constraints provided by the user, CATO will automatically complete an optimum design, using mathematical programming techniques, intelligent search methods and artificial intelligence (AI). Initial design and testing of a CATO prototype (CATO-1) has been completed recently. The objective was to prove the feasibility of combining AI techniques, simulation techniques, an optical device library and a graphical user interface into a flexible CAD tool for obtaining optimal communication network designs in terms of system cost and performance. CATO-1 is an experimental tool for designing packet-switching wavelength division multiplexing all-optical communication systems using a LAN/MAN ring topology as the underlying network. The two specific AI algorithms incorporated are simulated annealing and a genetic algorithm. CATO-1 finds the optimal number of transceivers for each network node, using an objective function that includes the cost of the devices and the overall system performance.