Design of a small heating reactor based on boiling water reactor (BWR) technology necessitates major deviations from the standard fuel assembly design for a large BWR plant. The small core size results in an extremely high axial peaking factor detrimental to core performance. A spatial poison zoning technique was implemented to flatten power density and burnup profiles, which in turn allows almost complete burnable poison burnout at end of cycle. Separation of the cooling and moderating functions of the water was achieved by tightening the fuel assembly lattice with simultaneous increase of the interassembly gap. Thus, the hot-to-cold component of the total reactivity control requirement is decreased. Design of the control rod system with different compositions and geometries for various control rod banks was investigated in order to satisfy safety-related limitations on the reactivity worth of a single control rod.