The cascaded H-Bridge Dynamic Voltage Restorer (DVR) is used for protecting high voltage and large capacity loads from voltage sags. The LC filter in the DVR is needed to eliminate switching ripples, which also provides an accurate tracking feature in a certain frequency range. Therefore, the parameter optimization of the LC filter is especially important. In this paper, the value range functions for the inductance and capacitance in LC filters are discussed. Then, parameter variations under different conditions of voltage sags and power factors are analyzed. In addition, an optimized design method is also proposed with the consideration of multiple impact factors. A detailed optimization procedure is presented, and its validity is demonstrated by simulation and experimental results. Both results show that the proposed method can improve the LC filter design for a cascaded H-Bridge DVR and enhance the performance of the whole system.