As battery temperature greatly affects performance, safety, and life of Li-ion batteries in plug-in and electric vehicles under various driving conditions, automakers and battery suppliers are paying increased attention to thermal management for Li-ion batteries in order to reduce the high temperature excursions that could decrease the life and reduce safety of Li-Ion batteries. Currently, the lack of fundamental understanding of the heat generation mechanism due to complex electrochemical phenomena prohibits accurate estimation of the heat generation within Li-ion cells under various operating conditions. Heat from Li-ion batteries can be generated from resistive dissipation, the entropy of the cell reaction, heat of mixing, and other side chemical reactions. Each of these can be a significant source of heat under a range of circumstances. The main purpose of the present study is to develop a practical heat source model for Li-ion batteries for HEV to help to assess the battery pack cooling performance. This paper summarizes the progress on the development and validation of the non-uniform heat source model. The temperature distributions of the battery during discharge from the heat source model were in good agreement with those from the experimental measurements at the discharge rates ranging from 0.5C to 5C.