A simple, low-cost testing method is proposed for fuel cell hardware development. A perforated aluminum foil with an array of small holes covered with carbon paper or cloth replaces the membrane electrode assemblies to test the contact resistance and gas permeability of the carbon paper. Practical fuel cells of reaction area with different gasket thicknesses and compressed pressures are tested for performance. The results of ohmic resistance and permeability of compressed carbon paper indicate strong relevance to cell performance, demonstrating that this novel testing method is valuable for fuel cell hardware development. Also, the compression mechanism of the diffusion layer is discussed along with a proposal for a strategy for improving cell performance. After that, an advanced design of a single cell is developed. The results of cell performance of the advanced cell are acceptable and competitive with the performance data of commercial products.