This paper proposes the concept of a direct contact thermoelectric generator (DCTEG) to enhance the practicality and widen the application areas of thermoelectric generators (TEGs). In the DCTEG, one thermoelectric module (TEM) surface is directly exposed to a heat source, and the other surface is in direct contact with a coolant flow. The current direct-contact configuration is beneficial for system fabrication, maintenance, long-term reliability, and maximizing energy usage in cooperation with other energy systems because of its simple configuration and lack of interfaces between the TEMs and heat sources. In order to validate the proposed concept experimentally, a DCTEG was constructed by fabricating customized TEMs and exhaust gas and coolant channels with openings to mount the TEMs. A diesel engine served as a heat source by providing hot exhaust gas into the DCTEG, while the coolant (water-ethylene glycol mixture) was pumped into the coolant channels to remove heat. Based on the experimental results obtained under various engine operating conditions, the power generation of the DCTEG was characterized in the form of current-voltage and power-voltage curves. The maximum output power of 43 W and conversion efficiency of 2.0% were obtained under the highest engine load and rotation speed conditions. A series of numerical simulations was carried out to investigate the effect of the system configuration on the DCTEG power generation performance with the clearance between the TEM surfaces and exhaust gas/coolant channel surfaces as a key parameter. Based on the validated numerical results and single module-based experimental results, a 132% increase in power output and 23% decrease in pressure drop are predicted for a configuration with TEMs flush-mounted to the exhaust gas and coolant channels compared to the original DCTEG configuration used in the experiment. The overall experimental and numerical results support the feasibility of the DCTEG concept and its potential for increasing the applicability of TEGs in various engineering fields. (C) 2017 Elsevier Ltd. All rights reserved.