Since distribution networks incorporate a large share of the losses in power systems, reducing losses in these networks is one of the most important issues of global networks, including issues that have always been taken into consideration. There are several ways to reduce losses in distribution networks, one of which is the installation of distributed generation units. Renewable sources can supply a clean and smart solution to the increased demands. Thus, Photovoltaic (PV) and Wind Turbine (WT) are taken here as resources of Distributed Generation (DG). Location and sizing of distributed generation have affected largely on the system losses. In this article, Exchange Market Optimization Algorithm­ (EMA) is proposed for optimal location and sizing of DG based renewable sources for the 69 buses distribution system. The exchange market algorithm on IEEE radial distribution system is simulated and studied using Matlab software and the results of the exchange market algorithm are compared with other algorithms. The results show the effectiveness of the exchange market algorithm in finding the optimal location and sizing of DG to reduce losses and improve the voltage profile.