An improved heat engine is disclosed. The heat engine comprises at least one heat pipe containing a working fluid flowing in a thermal cycle between vapor phase at an evaporator end and liquid phase at a condenser end. Heat pipe configurations for high-efficiency/high-performance heat engines are disclosed. The heat pipe may have an improved capillary structure configuration with characteristic pore sizes between 1μ and 1 nm (e.g. formed through nano- or micro-fabrication techniques) and a continuous or stepwise gradient in pore size along the capillary flow direction. The heat engine may have an improved generator assembly configuration that comprises an expander (e.g. rotary/turbine or reciprocating piston machine) and generator along with magnetic bearings, magnetic couplings and/or magnetic gearing. The expander-generator may be wholly or partially sealed within the heat pipe. A heat engine system (e.g. individual heat engine or array of heat engines in series and/or in parallel) for conversion of thermal energy to useful work (including heat engines operating from a common heat source) is also disclosed. The system can be installed in a vehicle or facility to generate electricity.