Heavy cavitation in torque converters can have a significant effect on hydrodynamic performance, particularly with regards to the torque capacity. The objective of this study is to therefore investigate the effects of pump and turbine blade geometries on cavitation in a torque converter and improve the torque capacity without increasing the torus dimension. A steady-state homogeneous computational fluid dynamics (CFD) model was developed and validated against test data at stall operating condition. A full flow passage with a fixed turbine-stator domain was used to improve the convergence and accuracy of the cavitation model. Cavitation analysis was carried out with various pump and turbine blade geometries. It was found that there is a threshold point for pump blade exit angle in terms of its effect on torque capacity due to heavy cavitation. Further increasing the pump blade exit angle past this point will worsen cavitation condition and decrease torque capacity. The study also shows that a higher turbine blade exit angle, i.e., lower stator incidence angle, could reduce flow separation at the stator suction surface and consequently abate cavitation. A base high-capacity torque converter was upgraded utilizing the cavitation model, and the resulting design exhibited a 20.7% improvement in capacity constant without sacrificing other performance metrics.