In a deregulated environment, optimal transmission switching (OTS) plays an important role in coordination among power generating companies (GENCOs) and transmission company (TRANSCO) by minimizing operating costs. This paper solves ac OTS (ACOTS) in two different stages sequentially with acoptimal power flow (ACOPF) and transmission switching through ac power flows (TS-ACPF) for optimal power generation and efficient power transmission, respectively. The mutual dependency along with the coordination among these optimal problems are treated intelligently by adopting a metaheuristic based two-stage algorithm with a multi-objective approach to achieve an effective solution through maximum utilization of power in the existing system or for future expansion planning. Production cost optimization problem is taken care of in thefirst stage while transmission loss is optimized in the second stage with successive iterations of the proposed algorithm. MATLAB simulations to optimize both transmission loss and production cost for both the IEEE-30 bus system and the Indian Utility 62-bus real system are experimented. Results are provided to validate the proposed technique which satisfies several cases of load variations, N - 1 standards and other combinations of stressed security constraint conditions. The detailed investigation of the results prove the effectiveness of theproposed intelligent two-stage method over the existing methods in terms of automatic and cost-effective biobjective solution relying on the flexibility of switching strategy and security by avoidance of islanding without any manual interaction in between