The miniaturization of electrical equipment and popularization of portable devices is an appealing motivation for the development of small-scale heat engines. However, the in-cylinder charge leaks severely as the engine dimension shrinks. The free-piston engine on a small scale provides better sealing than other miniature heat engines. Therefore, a miniature free-piston generator (MFPG) with a single-piston internal combustion engine (ICE) and a voice coil motor (VCM) was proposed in this work. A dynamic model with special attention on the heat transfer and leakage was established accordingly, upon which parametric studies of leakage and its effects on the performance of the MFPG system were performed. Four key parameters, including scavenging pressure, ignition position, combustion duration and piston mass, were considered in the model. The results showed that the mass leakage during the compression decreases with the rise of the motoring current. The indicated thermal efficiency can be improved by boosting scavenging pressure and increase motoring current. The critical ignition position is 2 mm before the top dead center. When ignition occurs later than that, the MFPG system is incapable of outputting power. The chemical to electric energy conversion efficiency is about 5.13 %, with an output power of 10~13 W and power density around 4.7~5.7 W/cc.