This paper addresses the design and challenges of FPSOs for deepwater applications. The building blocks of FPSOs of topsides, hull, turret, mooring and risers are reviewed and a design concept of FPSO for deepwater application in the South China Sea is configured. Especially, the turret configuration of the deepwater FPSO is proposed. Engineering analysis with regards to the system global performance, Turret loads design, mooring and riser designs and their impact to the turret and hull is conducted. The technical challenges facing the deepwater FPSO design in areas of turret loads, mooring and riser design, coupling effects between FPSO and moorings/risers are highlighted. In the deepwater application, the single point mooring system and the riser system design for the FPSO become the key issues in the project because both systems have to face new challenges, such as deep water depth, wild environments and high fluid pressure. A case study of a specific FPSO design in 1500m water depth in the South China Sea environment is then presented. The paper concludes that even though the design of the deepwater FPSO in harsh environment conditions can be technically challenging, the FPSO concept is a versatile solution for the deepwater applications in the South China Sea.