Waste heat is the result of a combination of systems inefﬁciencies and thermodynamic limitations which can result in up to 50% of energy being rejected. A report conducted by Energy Element Limited has estimated the heat available in waste steam from industrial processes amount to 48 TWh per year (3% of annual UK energy consumption). A forgotten heat recovery system that operates on low-grade steam is James Watt’s condensing steam engine. Following on from the experience and knowledge gained from last year’s Mk I engine, the aim of the project was again to design, build and test a modern adaptation of James Watt’s engine that utilizes forced expansion of steam. All possible improvements were identified before developing previous designs using CAD modelling and optimizing them through computational analysis. Replacement parts were manufactured and assembled before testing the engine with different condenser configurations. This was followed by the analysis and discussion of the results obtained using a newly developed dedicated control system. This project specifically looked at improving the efficiency of the engine through improvements to the condenser. Two methods to improve the efficiency of removing heat from the steam within the condenser was identified. The first method involved increasing the heat transfer of the condenser by increasing the surface area of the condenser through the use of fins. The second method used to improve the heat transfer within the condenser was to use a heat exchanger design. This method allowed for a cool water to flow through pipes within the condenser which help to remove the heat from the steam within the condenser.