A distribution system becomes the most essential part of a power system as it links the utility and utility customers. Under abnormal conditions of the system, a definitive goal of the utility is to provide continuous power supply to the customers. This demands a fast restoration process and provision of optimal solutions without violating the power system operational constraints. The main objective of the proposed work is to reduce the service restoration cost (SRC) along with the elimination of the out-of-service loads. In addition, this work concentrates on the minimal usage and finding of optimal locations for additional equipment, such as capacitor placement (CP) and distributed generators (DGs). This paper proposes a two-stage strategy, namely, the service restoration phase and optimization phase. The first phase ensures the restoration of the system from the fault condition, and the second phase identifies the optimal solution with reconfiguration, CP, and DG placement. The optimization phase uses the teaching–learning algorithm (TLA) for optimal restructuring and optimal capacitor and DG placement. The robustness of the algorithm is validated by addressing the test cases under different fault conditions, such as single, multiple, and critical. The effectiveness of the proposed strategy is exhibited with the implementation to IEEE 33-bus radial distribution system (RDS) and 83-bus Taiwan Power Distribution Company (TPDC) System.