Hydraulic retarders have been widely used in heavy-duty vehicles because of its advantages such as large braking torque and long operating hours. They can be used instead of service brakes in non-emergency braking conditions and can also reduce frequency and time of driver’s actions in braking process, thereby minimizing heat-related problems. In order to accurately produce braking torque needed for the vehicle in time by using hydraulic retarder, which enable the vehicle to travel stably and safely during downhill driving, aiming at the constant-speed function of hydraulic retarder, the research of constant speed control method is conducted in this paper. The structure and working principle of hydraulic retarder is introduced and the dynamic characteristic is analyzed. And the theoretical model of vehicle and hydraulic retarder are established based on dynamic analysis of the vehicle downhill driving. The braking process that involves the hydraulic retarder is divided into three stages. Then the common PID algorithm is improved, the PID parameters are optimized by using fuzzy reasoning method based on the change of vehicle speed error and the rate of error, a fuzzy PID constant-speed controller is designed. The vehicle dynamic model and the constant speed control model of hydraulic retarder are established using MATLAB/SIMULINK and the simulation has been carried out. The simulation results show that compared with common PID controller, the fuzzy PID controller designed in this paper has better constant-torque performance and anti-inference performance that enable the vehicle to travel at a constant speed in either a constant or a changing slope.