This work presents the effect of particles density and body diameter on hold up mass and heat transfer rate in cyclone heat exchanger by using CFD analysis. Performance of cyclone heat exchanger is based on operational and geometrical parameters which mainly depend on inlet air velocity and solid particles parameters. Present work studies the effect of particles density, diameter of cyclone, inlet air velocity, and temperature on performance of cyclone heat exchanger. The RNG k-ε turbulence model was adopted in ANSYS FLUENT 12.0 software to analyze the flow field and discrete phase model is adopted to predict tracking of solid particles in cyclone. Solid particles density ranges from 2050 to 8950 kg/m3 for different materials fed at 0.5 g/s flow rate and inlet air velocity ranges from 5 to 25 m/s at three inlet air temperature 373, 473, and 573 K for 100, 200, and 300 mm body diameter cyclone heat exchangers. Results conclude that increase in diameter of cyclone increases hold up mass and heat transfer rate whereas increase in density of particles decreases the hold up mass and heat transfer rate. Experimental set-up was built for Stairmand high efficiency cyclone and good agreement was found between simulation and experimental result. New correlation was proposed for non-dimensional hold up mass. Correlation compared with experimental hold up mass and predicts experimental value within an error band of –3 to 6%.