In this paper, an optimal sizing model has been performed to optimize the different configurations of hybrid PV/diesel water pumping system, (HPDWPS) employing water tank storage. The suggested model involves the sub models of the hybrid system, the Loss of Power Supply Probability, (LPSP) and the Life Cycle Cost, (LCC). Thus, through the application of the studied model, the techno-economic optimization of such system can be easily realized. The adopted methodology suggests different procedures based on the water consumption profiles, total head, tank capacity, diesel generator backup system and photovoltaic array peak power. In the aim to highlight the reliability of the developed model, a case study is conducted to investigate one hybrid system project, which is designed to supply the drinking water to secluded and scattered small villages of Ghardaïa region (South Algeria). Moreover, the optimized hybrid system is compared to other energy source options, namely PV/TANK system and Diesel/TANK.