Desiccant based air conditioning systems are a suitable way to improve indoor air quality due to its superior humidity control. In this study, a novel desiccant based air conditioning system is designed and tested experimentally to improve the indoor air quality and reduce energy consumption. In the system studied, a heat exchanger, which is not used in this type of systems, for pre-heating the regeneration air with exhaust air is used. This paper reports results of initial operation and operational procedures. The performance of the system and its components is discussed. (C) 2010 Elsevier B.V. All rights reserved.