Key physics issues in the design of a high-beta quasi-axisymmetric stellara
tor configuration are discussed. The goal of the design study is a compact
stellarator configuration with aspect ratio comparable to that of tokamaks
and good transport and stability properties. Quasi-axisymmetry has been use
d to provide good drift trajectories. Ballooning stabilization has been acc
omplished by strong axisymmetric shaping, yielding a stellarator configurat
ion whose core is in the second stability regime for ballooning modes. A co
mbination of externally generated shear and non-axisymmetric corrugation of
the plasma boundary provides stability to external kink modes even in the
absence of a conducting wall. The resulting configuration is also found to
be robustly stable to vertical modes, increasing the freedom to perform axi
symmetric shaping. Stability to neoclassical tearing modes is conferred by
a monotonically increasing i profile. A gyrokinetic delta f code has been u
sed to confirm the adequacy of the neoclassical confinement. Neutral beam l
osses have been evaluated with Monte Carlo codes.