Thermoplastic Polyolefins (TPOs) usually being a mixture of copolymer polypropylene and a plastomer with certain loading levels, providing elastomeric properties, are one of the most commonly used polymeric materials than commercial polyolefins in automotive industry. Since they are mainly used in big parts of the automotive such as bumper, exterior trim and dashboard which have very high aspect ratio, controlling the mold shrinkage of these TPOs during the production is one of the most challenging problems in automotive industry. Therefore, this study aims to prepare TPO formulations with minimum mold shrinkage and optimum mechanical properties. In the light of this purpose, TPO formulations were prepared by incorporation of plastomers having different physical/mechanical properties. Following to compounding process, mechanical and thermal test were performed, and their results were discussed to find the optimum TPO formulation with low mold shrinkage and optimum mechanical properties. Prior to compounding, the structural analysis and molecular dynamic (MD) simulations of these plastomers and compounds with highest and lowest crystalline plastomer were performed to comprehend the chemistry, conformations and the microstructure of selected plastomers and their macroscale effects on the final TPO product. Even though the lowest mold shrinkage values were obtained with incorporation of the lowest crystalline plastomer, the optimum TPO compound is found by incorporation of 70% medium crystalline plastomer and 30% copolymer PP. It yields low mold shrinkage values in parallel (0,19%) and perpendicular (0,2%) to flow direction and optimum tensile strength (13,4 MPa), tear strength (74,4 N/mm) and elongation at break (815%) results. So, this study provides significant findings that are useful to understand the relationship between the structure and function of the compounds and to determine the required PP-plastomer ratio with desired physical and mechanical properties.