To realize the efficient and low-cost utilization of offshore renewable energy, a novel direct drive wind-wave combined energy conversion (WWCEC) system which is based on a two-degree-of-freedom linear-rotary generator (LRG) comes into being nowadays. It inherently has some merits of low cost, high efficiency, and good operation stability. This article proposes a permanent magnet LRG with a new topology for the direct drive WWCEC system and conducts its optimization to ensure good performance for the whole system. A technique for order preference by similarity to an ideal solution is used to finish the optimization to trade off among no-load back electromotive force (EMF), harmonic distortion rate of no-load back EMF, and cogging torque/detent force of rotary/linear generator unit. The optimization process includes initial design, sensitivity analysis of optimization parameters, weight coefficient determination of optimization object, and final decision. The performance comparison before and after the optimization shows that almost all optimization objects are improved. Finally, a prototype is manufactured according to the optimal dimensions. Some verification is conducted on its platform, and the results demonstrate that the design and optimization given in this article are effective in improving the performances of the proposed LRG for the WWCEC system.