This article introduces a newly suggested meta‐heuristic arithmetic optimization algorithm (AOA) to reorganize the distribution network with the simultaneous distribution of distributed generators (DGs). The algorithm is designed to be flexible with a new approach that employs the scattering behavior of arithmetic operators in mathematics to discover the solution space more proficiently throughout the path of iterations. The usefulness of the AOA is demonstrated on 33‐bus, and 69‐bus radial distribution networks (RDNs) with network reconfiguration (NR) in the presence of DGs. The main objective of NR and effective DG arrangement in RDNs is to truncate the true power loss, reduce the voltage fluctuation, and voltage stability index enlargement. In order to increase the efficacy of the RDN, a multi‐objective function is created in view of active power loss, voltage deviation, and voltage stability index of the system with appropriate strategy without destroying the system restrictions. To illustrate the effectiveness of the RDN, four separate cases of NR and DG employment have been carried out. Four cases namely, base case (case‐1), reconfiguration (case‐2), simultaneous reconfiguration and DG installation with a unity power factor (case‐3), and simultaneous reconfiguration and DG installation with 0.95 lagging power factor (case‐4) are explored. The projected technique gives better results than other renowned methods, namely, fireworks algorithm (FWA), harmony search algorithm (HSA), refined genetic algorithm (RGA), and improved sine‐cosine algorithm (ISCA) strategy in view of 33, 69‐bus RDN at three dissimilar load conditions and its supremacy is confirmed.