This paper describes the LYCOS system, an experimental co-synthesis environment. We present the motivation and philosophy of LYCOS and after an overview of the entire system, the individual parts are described. We use a single CPU, single ASIC target architecture and we describe the techniques we use to estimate metrics concerning hardware, software and communication in this architecture. Finally we present a novel partitioning technique called PACE, which has shown to produce excellent results, and we demonstrate how partitioning is used to do design space exploration.