Abstract
This paper deals with the process and requirements of a capstone design project performed by undergraduate students. We discuss about the preliminary study for the capstone design, the derivation of a subject, the level descriptor of the subject, and the system requirements. And then, we summarize the results of the capstone design project entitled as Microsoft Azure based IoT (Internet of Things) system which is performed by 4 undergraduate students during 10 months. This system is composed of a Zigbee sensor network, the TCP/IP Internet, an IoT server, and a smartphone application program, with which we can gather the sensor data and control actuators at the far away area.