Twist optimization of a helicopter rotor in hover is presented using compressible computational fluid dynamics as the aerodynamic model. A domain-element shape parameterization method has been developed, which solves both the geometry control and the volume mesh deformation problems simultaneously, using radial basis function global interpolation. This provides direct transfer of domain-element movements into deformations of-the design surface and the computational fluid dynamics volume mesh, which is deformed in a high-quality fashion. The method is independent of mesh type (structured or unstructured), and it has been linked to an advanced parallel gradient-based algorithm, for which independence from the flow solver is achieved by obtaining sensitivity information by finite differences. This has resulted in a flexible and versatile modular method of wraparound optimization. Previous fixed-wing results have shown that a large proportion of the design space is accessible with the parameterization method, and heavily constrained drag optimization demonstrated significant performance improvements. In the present work, the method is extended to a rotor blade, and this is optimized for minimum torque in hovering flight with strict constraints. Twist optimization results are presented for three tip Mach numbers, and the effects of different parameterization levels are analyzed using various combinations of two levels: global and local. Torque reductions of over 12% are shown for a fully subsonic case, and for over 24% for a transonic case, using only three global and 15 local twist parameters.