Connectionless service such as SMDS, or its European equivalent CBDS, can be provided by an ATM network by building a separate connectionless overlay network (CLON) on top of the ATM bearer service. A CLON is composed of a number of connectionless servers, CLSs, which provide the routing function, connected by semipermanent virtual paths (VPs). In this paper, architectural issues related to the design of a CLON are studied. In particular, we address the question of the optimal number of CLSs and their interconnection topology, assuming the underlying ATM network and the mean connectionless traffic load are known. The objective of the design process is to meet given design criteria with minimum costs. The QoS requirements of the SMDS/CBDS service are briefly reviewed and a simple cost model for the CLON network is given. The dimensioning of the logical links is also considered. Then the design process to find the optimal solution for the whole network is outlined. A simplified procedure was applied in numerical studies of the topological optimization. In order to find the general dependence of the optimal number of CLSs on the size of the network and other network parameters, the optimization procedure was applied to a large number of sample ATM networks, generated by an algorithm which is briefly described. Results from these studies are presented and discussed.