Investigations are currently being conducted by the Navy and several contractors to determine the technical feasibility and cost effectiveness of advanced regenerative or intercooled‐regenerative gas turbines as a naval propulsion engine for future mid‐size surface combatants. A comparison of the performance characteristics of these engines indicates that significant increases in the thermal efficiency above current simple‐cycle engines will result by adding heat exchangers for regeneration alone or with intercooling. Design and performance characteristics of several advanced‐cycle gas turbines are described which utilize turbomachinery from various existing simple‐cycle gas turbines. Estimates of the weight and volume of recuperators and intercoolers for these conceptual engines are provided. The nominal part‐load fuel consumption trends of the simple‐cycle and the advanced‐cycle engines are used to compare annual fuel usage of typical ships with various combinations of propulsion engines. The relative impacts of the advanced‐cycle gas turbine on propulsion machinery spaces are compared with other energy efficient prime movers using the simple‐cycle gas turbine as the baseline. Commercial applications for an advanced‐cycle gas turbine are surveyed according to output power and market sector. This paper presents an overview of current results and discusses the technology areas which require additional investigation.