Abstract In hot and humid regions, vapor-compression cooling systems impose high power demand to grid and increase peak of the load. While thermally activated cooling systems can be a sustainable solution, they are even more beneficial when driven by waste heat. In this paper, a multi-generation system including gas engine, desiccant cooling system and thermal desalination system is studied under three different weather conditions. In the desiccant system, two innovative cycles are applied in which the humidity of regeneration air is higher than conventional systems. Therefore, dew point temperature will be high enough for water condensation. The results show it can compensate for 121% of consumed water in humid areas. Moreover, thermal COP is within range of 0.61–1 in studied cities. While the cooling system uses the jacket water heat, desalination system is powered by the flue gasses. It can annually desalinate 1,122 and 1,817 m3 water by heats of the engines with powers of 33 and 55 kVA. Economic investigation shows levelized cost of cooling is within range of 1.5 to 20 US cents depending on the system size and weather conditions. Besides the water price, the difference between electricity and gas prices plays a key role in system economic feasibility.