Now a days all wireless communication systems de-mands for high capacity and high data rate. The long term evolution(LTE) wireless communication stand-ard is used to achieve the high data rate during mo-bility. For the increase in coverage area LTE has developed the small cellular cells. These cells are known as femtocells[2]. Femtocells improves data and voice capacity dramatically. But there is one problem regarding with femtocell and that is the in-terference between two femtocells called as Intercell interference(ICI) and interference between one femtocell and one macrocell called as Cross tier in-terference. This interference problem causes signifi-cant degradation in performance. We are trying to propose a system which will together mitigate the Intercell Interference and cross tier interference. In this project, we propose a scheme called Cluster-Aware Soft Frequency Reuse (CASFR) which will assign the set of Physical Resource Blocks (PRB)s to each interfering femtocells. The CASFR first uses periodic messages/symbols from the user to identify the interfering femtocells. It then splits each femtocell area into cell-edge and cell-center. At the last, it uses the algorithm to assign the sets of PRBs which are not interfering to the cell-edge and cell-center users of all the interfering femtocells. We also proposed a PRB Swapping and Exchange (PSE) al-gorithm for the to reduce any interference that may remain after performing CASFR. CASFR is used for downlink interference mitigation and PSE for uplink interference mitigation.