The breeding potential of thermal reactors fueled by plutonium is evaluated on the basis of present nuclear cross-section data. It is shown that it is possible to obtain initial conversion ratios in excess of unity in highly thermal D2O-moderated systems. Because of the low thermal value of η49 and its decrease with spectrum hardening, it becomes necessary to keep the moderator at low temperatures and also to utilize the fast-fission effect in U238 to the maximum extent in order to achieve high conversion ratios. Based on these results a conceptual design of a plutonium-fueled D2O-moderated reactor is developed. Large diameter, clustered-rod fuel elements in pressure tubes are considered. Using this type of fuel element it is possible to keep the moderator at a low temperature,thereby minimizing the hardening of the spectrum, and also to obtain a large fast-fission effect in U238. This type of fuel element also permits the use of different coolants such as steam or gas in addition to pressurized D2O. Although initial conversion ratios slightly above 1.0 are possible, true breeding in dirty, plutonium-fueled, thermal reactors is not claimed. The specific power obtainable varies from 0.8 to 5 MW/kg of Pu depending on the size of the fuel cluster and on the coolant used.