Optimization has been successfully applied to systems with a single discipline. As many disciplines are involved in coupled fashion, MDO (multidisciplinary design optimization) technology has been developed. MDO algorithms are trying to solve the coupled aspects generated from interdisciplinary relationship. In a general MDO algorithms, a large design problem is decomposed into small ones which can be easily solved. Although various methods have been proposed for MDO, the research is still in the early stage. This research proposes a new MDO method which is named as MDOIS (Multidisciplinary Design Optimization Based on Independent Subspaces). Many real engineering problems consist of physically separate components and they can be independently designed. The inter-relationship occurs through coupled physics. MDOIS is developed for such problems. In MDOIS, a large system is decomposed into small subsystems. The coupled aspects are solved via system analysis which solves the coupled physics. The algorithm is mathematically validated by showing that the solution satisfies the Karush-Kuhn-Tucker condition.