The torch nozzle of a plasma cutting machine has a water cooling jacket that reduces wear due to heat input from the plasma arc. Although its cooling capacity is a determining factor in nozzle life, the cooling jacket also affects the nozzle’s minimum oblique standoff height, which is a consideration when it comes to improving the machine’s cutting performance, and there is a trade-off between this minimum standoff and cooling capacity. When the minimum oblique standoff is reduced, accordingly, maintaining or improving the cooling capacity becomes a key issue. This paper reports on a study that used a quantitative evaluation methodology and an L18 orthogonal array to optimize the cooling capacity of a nozzle with reduced minimum oblique standoff. The study produced a new nozzle design that is now in volume production for machines being sold on the market.