The experience of leading countries in distributed energy systems (e.g., Scandinavian countries) shows that district cooling systems are highly beneficial techno-economic-environmentally by facilitating the use of waste heat resources, solar energy, etc. for cold supply at large scales. This study proposes the optimal development of a novel district cooling design equipped with a large-scale cold storage unit and utilizing the exhaust waste heat of an energy plant in a case study in Saudi Arabia. The optimal configuration of the hybrid system, the sizing of its components, and operating conditions are found using multi-objective optimization techniques based on the genetic algorithm method and a creative performance assessment index. Then, the feasibility of this optimized proposal is investigated through comprehensive thermodynamic and economic analyses. The results show that a district cooling system can surely cope with the harsh climate condition of the case study and provide the required interior comfort conditions. The energy and exergy efficiencies of the system can be as high as 62% and 53% using an absorption chiller utilizing a power plant’s waste heat along with a storage tank for peak shaving. The levelized cost of cooling of the system can be 28 USD/MW h, by which the payback period will be only 8 years.