As an auxiliary brake element, the eddy current brake is widely used to ensure safe driving in heavy vehicles due to its noncontact braking characteristics. It is important to increase the power density of the eddy current brake and suppress the thermal derating of its braking performance. According to the principle of the eddy current braking and current skin effect, a decline in temperature can greatly increase the eddy current density of the low-frequency electromagnetic device. In this paper, a new heat dissipation method is proposed to cool the heating surface of the eddy current brake directly. The electromagnetic field model and the flow-heat coupling model are established to predict and analyze the steady-state temperature distribution and braking torque. A new type of internal liquid cooling eddy current brake prototype was manufactured for a bench test. The experimental data prove that the computational model is effective. The calculation results show that the new internal liquid cooling eddy current brake has improved heat dissipation advantages.