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A method for generating few-group homogenized cross sections using three-dimensional Monte Carlo assembly calculations is described and compared to a traditional two-dimensional assembly homogenization method. It is demonstrated that the traditional two-dimensional method of few-group homogenized cross section generation for full core analyses may not be sufficient for high conversion LWR designs. In these types of reactors, such as the Hitachi RBWR, separate fissile and blanket zones are required for breeding and for managing void reactivity feedback, resulting in highly axially-heterogeneous assemblies. In the two-dimensional calculation, each zone was decoupled from other zones by assuming zero net current boundary conditions. In the three-dimensional calculation, the presence of other axial zones that influence the generation of homogenized cross sections is explicitly captured. Differences in flux energy spectra were seen, leading to differences in 2-group homogenized cross sections of up to 50%. The differences in the homogenized parameters were highest in interface zones and near the top of the assembly due to the presence of an axial reflector and a high coolant void fraction. It was determined that these errors may be significant and propagate to the full core analysis of these types of advanced LWRs., United States. Department of Energy. Naval Reactors Division (Rickover Fellowship)