In flexible manufacturing cells, changes in demand size, product mix, part variety, existing routings and set-up/operation times may require reconfiguration of the cells. In this study, an approach is developed to decide when and how such a reconfiguration should be carried out for existing cells. This study considers reconfiguration in terms of changing part routings, adding a new machine type in a cell, duplicating an existing machine type, removing an existing machine from a cell and transferring a machine to another cell. The study also shows the total number of tools of each type on each machine located in each cell after reconfiguration. To make the optimal reconfiguration decisions, a mathematical programming model to minimize the total reconfiguration cost is developed. The developed model considers the lower and upper bounds on machine utilizations and the time limits on machine cycle times to decide when to reconfigure the system.