In this paper, an outer rotor flux-switching permanent-magnet (FSPM) motor incorporating the concept of stator permanent-magnet motor into outer-rotor motor is investigated. Similar to the traditional FSPM motors, the torque ripple of the motor is relatively high. In order to realize the torque ripple reduction effectively, a new systematic multi-level design and control scheme is proposed to coreduce the torque ripple of the proposed motor. In motor design level, by adopting the design of experiments method and the response surface method, the lower cogging torque with desirable high output torque and efficiency can be obtained. In motor control level, the optimization model based on the iterative learning control method is proposed, wherein the optimal compensating torque can be produced to further suppress the torque ripple. Finally, a prototype motor is manufactured for evaluation. Both simulation and experiment results verify the validity of the proposed method.