Prompt gamma neutron activation analysis (PGNAA) is a nondestructive nuclear method for detection of various elements present in a material sample. In this method the sample is irradiated by neutrons. The neutrons are absorbed by the target nuclei with different proabilities and compound nucleus is formed. The conpound nucleus then emits prompt gamma-ray. These prompt gamma rays are characteristic of the elements present in the sample. So by detecting and analysing these gamma rays, we can determine the type and amount of the elements present in the sample. Instruments needed for this analysis are neutron source, sample, gamma detector, gamma and neutron sheilds. The purpose of this thesis is desiging a proper shield and a proper moderator with optimum thicknesses and materials for the Am-Be neutron source to detect prompt gamma rays emitted from nitrogen present in explosive materials. The Am-Be source emits a 4.43 MeV gamma ray resulted from the decay of exited carbon and the mean energy of neutrons emitted from this source is 4.4 MeV. The optimum sheild for this source increases the PGNAA efficiancy by decreasing the pile up due to source gamma and increasing the thermal nutron flux in the sample. So at first step we assumumed a cylinder lead shield around the source and calculated the optimum thickness for the shield by simulation. The optimum thickness was found to be 5cm which decreases source gamma ray by %90, but due to lab facilities limitations we could use a cylinder lead shield with a thickness of 3.5cm which attenuates the source gamma ray to about %70. Explosive materials contain nitrogen. Nitrogen absorbs thermal neutrons with 0.75 barn of crossection and emits a 10.83 MeV prompt gamma ray. For increasing the thermal neutron in the sample, three types of moderators; water, polyethelen and graphite with different thicknesses were simulated and for each type optimum thickness was found. The optimum thickness of water and polyethelen is 3cm and for graphit is 15cm. After that we used a graphite refelector around the source for increasing the neutron flux in the sample. Finally for verifing the simulations, two experiments were done. The lab conditions were simulated and the optimum thickness of water was determined 2cm with polyethylene container. So experiments were done for optimum thickness, and for 5cm thickness for examining the more water thickness. The experimental result is compatible with simulation result. So we can say that the designed system in terms of shield and moderator of source has optimum condition in order to detect explosive materials. Keywords: 1-Prompt gamma neutron activation analysi 2-PGNAA 3- Explosive detectio 4- Am-Be neutron source