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In this study, the capacity and location of battery energy storage systems (BESSs) in a distribution network were evaluated to increase the stability and reliability of power systems by applying the proposed transient stability indicators. The search capability of particle swarm optimization (PSO) combined with Pareto optimality in MATLAB R2019b was used to solve multi-objective problems in steady-state conditions, including active power loss, voltage deviation, and total operating cost. The BESS capacity and location were then derived using the Manhattan distance method. Subsequently, the BESS control model was constructed using the commercial software DIgSILENT PowerFactory 2021 to evaluate generator power smoothing and short-term voltage stability index during the transient response and determine the final capacity and location of BESS in distribution networks. Finally, the accuracy of the proposed method was verified by considering the daily load and solar power generation curves using the IEEE 33-bus radial power distribution network.