A pile-supported OWC breakwater is a novel marine structure in which an oscillating water column (OWC) is integrated into a pile-supported breakwater, with a dual function: generating carbon-free energy and providing shelter for port activities by limiting wave transmission. In this work we investigate the hydrodynamics of this novel structure by means of an analytical model based on linear wave theory and matched eigenfunction expansion method. A local increase in the back-wall draft is adopted as an effective strategy to enhance wave power extraction and reduce wave transmission. The effects of chamber breadth, wall draft and air chamber volume on the hydrodynamic performance are examined in detail. We find that optimizing power take-off (PTO) damping for maximum power leads to both satisfactory power extraction and wave transmission, whereas optimizing for minimum wave transmission penalizes power extraction excessively; the former is, therefore, preferable. An appropriate large enough air chamber volume can enhance the bandwidth of high extraction efficiency through the air compressibility effect, with minimum repercussions for wave transmission. Meanwhile, the air chamber volume is found to be not large enough for the air compressibility effect to be relevant at engineering scales. Finally, a two-level practical optimization strategy on PTO damping is adopted. We prove that this strategy yields similar wave power extraction and wave transmission as the ideal optimization approach.