Modular Heliotron concepts with well-defined and efficient closed helical divertor are studied. The physics optimization of this system has been carried out based on the LHD (Large Helical Device) concept by means of vacuum magnetic surface analyses and finite-beta calculations. The effectiveness of this new modular coil system and its magnetic configuration are clarified. Engineering design of this Modular Heliotron Reactor (MHR) is also carried out based on this physics concept and engineering scalings, and the required machine parameters for DT ignition reactors are clarified.