This study presents an optimized and novel AlGaN/GaN HEMT structure which is developed using TCAD (Technology Computer-Aided Design) simulations. The calibrated D-Mode AlGaN/GaN HEMT is converted into an E-Mode transistor using nitrogen implantation and the device optimization is achieved by changing the thickness of the GaN cap layer. With the increase of GaN cap layer thickness from 0nm to 2nm the device achieved an increment in the breakdown voltage from 159V to 720V and drain current from 1.11×10− 05 A/mm to 1.99×10− 02 A/mm. The large Ids of the HEMT with GaN cap layer are attributed to the increase of the concentration of two-dimensional electron gas (2DEG). The leakage current is reduced from 1.07×10− 08 A/mm to 5.35×10− 11 A/mm thereby increasing the device performance with the use of the GaN cap layer. The shift in Vth, bandgap, and an increase of Electron Density is also observed by altering the GaN cap thickness from 0nm to 2nm. The current gain of the 2nm GaN cap device is shown with an increase in gate voltage ramping (Vgs).