Hazmat cars are subject to differing probabilities of being involved in a derailment depending on their positioning in trains. This effect is particularly important in long-freight-train characteristic of North American operation. For decades there has been discussion about whether operating practices and regulations should account for this to reduce the chance that hazmat cars will be involved if a train derails. This paper presents a position-dependent, railcar-based method to analyze derailment probability of hazmat cars and identify optimal placement strategies that minimize the expected number of hazmat cars derailed. The method considers derailment probabilities of each hazmat car at each location in a train and investigates the optimal placement of hazmat cars given train makeup, train derailment speed, and the percentage of hazmat cars. A case study based on realistic train configuration and operational conditions is presented that demonstrates the method and a sensitivity analysis is presented that explores the effect of key factors on the placement strategies. The research indicates that there is no single placement strategy that minimizes the hazmat car derailment probability under the variety of characteristics typical of North American freight train operation. This result has implications for rail hazmat transportation safety, operations, efficiency and regulatory policy. This research advances our understanding of the effect of hazmat car placement on operating safety and risk and enables development of holistic quantitative models to address the trade-off between hazmat train operating safety and efficiency that accounts for both mainline derailment severity and yard activities related to train make-up.