In this paper, a new bio inspired optimization technique called Moth Swarm Algorithm (MSA) is developed to find the optimal solution for Combined Economic and Environmental dispatch (CEED) problems. Its aim to minimize both the operating fuel cost and emission levels simultaneously while satisfying load demand and operational constraints. The CEED problem is formulated as multi-objective function by considering the fuel cost and environmental pollutant impact with satisfying load demand and operational constraints. The developed algorithm is carried on two different test cases having valve point effect. The simulated result is compared with those obtained by other algorithms in the literature to confirm its effectiveness. Results show that the MSA gives best fuel cost and minimum emission than the other reported algorithms.