ABSTRACT The theory of hydraulic optimization of drilling with conventional (incompressible) drilling fluids is well known and has been widely practiced in the industry. Classical theory of hydraulics optimization for maximum drilling rate calls for either the use of empirical correlations or the use of optimization theory to maximize some arbitrary objective functions such as maximum bit hydraulic horsepower or jet impact force. Concept of hydraulic optimization for maximum drilling rate when drilling with foam, however, is not well investigated. Compressible nature of the foam makes the use of conventional optimization theory difficult. A transient-mechanistic model of cuttings transport with foam has been developed and numerically solved recently. In this study, the new model has been used to re-visit classical theory of hydraulic optimization (i.e. maximum bit hydraulic horsepower/jet impact force criteria). A new methodology has been suggested to determine optimum gas/liquid injection rates for maximizing drilling rate when drilling with foam while keeping the bottom hole pressure minimum. The new method can be easily used in the field to determine best combination of gas/liquid injection rates and total bit flow area (i.e. jet nozzle sizes) such that maximum drilling rate is achieved.