This paper describes the progress of the DEMO design and R&D activities in Europe. The focus is on a systems engineering and design integration approach, which is recognized to be essential from an early stage to identify and address the engineering and operational challenges, and the requirements for technology and physics R&D. We present some of the preliminary design choices/sensitivity studies to explore and narrow down the design space and identify/select attractive design points. We also discuss some of the initial results of work being executed in the EUROfusion Consortium by a geographically distributed project team involving many EU laboratories, universities, and industries in Europe. (C) 2016 The Authors. Published by Elsevier B.V.