Abstract: This is the first work to present the progress made in the conceptual design and development of the diagnostics for the China Fusion Engineering Demo Reactor (CFEDR). Different from present diagnostics, new requirements and challenges arising from burning plasma for CFEDR diagnostics have been investigated. These specifications facilitate establishing criteria for measurement identification and technique selection. A comprehensive workflow is then outlined to clarify the design steps. Given the harsh environment and limited port resources, a compact and robust diagnostic system is envisioned. The measurements for nuclear safety, machine protection, plasma operation control and fusion physics understanding are proposed, and corresponding candidate techniques are selected for CFEDR. Key R&D challenges, such as the high neutron radiation environment and advanced diagnostic port integration, are identified. Additionally, the development of new diagnostic techniques and synthetic diagnostics is discussed. Finally, the paper concludes by outlining future work.