Aiming at the optimization of the power density, a parameter design method is proposed for the capacitive power transfer(CPT) system. To reduce the volume of compensation inductors, magnetic-core inductors are used to replace air-core inductors. That is, the constraints of the power density consist of the air breakdown voltage limitation and the magnetic-core loss limitation. To quantify the impact of the magnetic-core loss on the power density, the current stress and quality factor of magnetic-core inductors are discussed. Taking the power density as the main optimization objective, a parameter design method is proposed in this article. Since there exist several design points for power density optimization, efficiency is chosen as the auxiliary optimization objective to realize the parameter design. Thus, the proposed design method can optimize not only the power density but also efficiency. To verify the effectiveness, a 100 W output CPT system is built in this article. The experimental results show that the power density of the CPT system can reach 4.08 W/in3, and the peak DC-DC efficiency can reach 92.06%.