With the continuous increasing requirements of commercial vehicle weight and speed on highway transportation, conventional friction brake is difficult to meet the braking performance. To ensure the driving safety of the vehicle in the hilly region, the eddy current retarder (ECR) has been widely used due to its fast response, lower prices and convenient installation.ECR brakes the vehicle through the electromagnetic force generated by the current, and converted vehicle mechanical energy into heat through magnetic field. Air cooling structure is often used in the traditional ECR and cooling performance is limited, which causes low braking torque, thermal recession, and low reliability and so on.The water jacket has been equipped outside the eddy current region in this study, and the electric ECR is cooled through the water circulating in the circuit, which prolongs its working time. The cooling flow water also can be modulated to control the temperature of the ECR precisely, which also reduces the eddy current retarder’s heat fade.The mathematical model of TRJ1500Nm ECR electric-magnetic-heat has been established, and flow channels integrated to the retarder shell have been designed based on the heat source distribution characteristics, the effect of flow rate’s controlling capacity to the ECR wall’s temperature also has been studied. The characteristic parameters of thermal management unit has been determined combined with the system simulation. And finally the relationship among the braking torque, the flow of water medium and the electric ECR temperature has been determined.Anticipate results has been achieved that heat fade rises gradually once the working temperature over 500 degrees Celsius while lower working temperature doesn’t influence it obviously, and water cooled medium could control the upper limit of the ECR’s working temperature, improve braking torque and reduce the thermal recession in this study. This method provides a new way for the cooling of ECR, and has a certain reference value to the design of thermal management system of ECR.