In this study, difference of the expansion valve and expander usage in two-stage, transcritical R744 (CO2) refrigeration cycle was analyzed thermodynamically. Variable parameters on this study are gas cooler pressure, inter-stage pressure and evaporation temperature of refrigerant. Isentropic efficiency of the compressor is calculated by an empirical equation. COP and second law efficiency values of cycles are obtained by parametrical analysis. By using expander instead of expansion valve in the cycle, COP and second law efficiency values increase 10% averagely. Additionally, it is emphasized that there could be an optimum evaporation temperature concept, and the general approach for calculation of inter-stage pressure is a wrong practice for cycle efficiency.