Performance and power consumption are most important issues while designing embedded systems. Several studies have shown that cache memory consumes about 50% of the total power in these systems. Thus, the architecture of the cache governs both performance and power usage of embedded systems. A new N-way reconfigurable data cache is proposed especially for embedded systems. This thesis explores the issues and design considerations involved in designing a reconfigurable cache. The proposed reconfigurable data cache architecture can be configured as direct-mapped, two-way, or four-way set associative using a mode selector. The module has been designed and simulated in Xilinx ISE 9.1i and ModelSim SE 6.3e using the Verilog hardware description language.