This document proposes a new design for an internal combustion engine with variable displacement. The design aims to optimize engine power by allowing the displacement, and therefore power output, to be varied according to need. This is achieved by introducing a hydraulically-actuated crankshaft that can vary the crank radius and thus the piston stroke length. The document outlines the objectives of studying how this mechanism varies engine capacity and compression ratio. It then describes the methodology of simulating the engine model and analyzing graphs of displacement, velocity and acceleration versus crank angle. The conclusion is that the new mechanism produces less vibration, longer engine life, smoother acceleration and lower emissions compared to existing variable displacement designs.