A numerical tool to simulate micro-channel flow and heat transfer in compact heat exchangers is developed. The method is based on a forced convection porous body approach combined with conventional pipe flow closure correlations. The proposed technique aims to provide developers of micro-channel heat exchangers with a fast efficient tool to estimate the thermodynamic behaviour dependent on geometry and operation conditions. The program calculates outlet temperatures, pressure losses and vapour volume fractions, if boiling occurs. In addition the thermohydraulic conditions inside the heat exchanger can be determined. First results are compared to experiments with cross flow and counter flow heat exchangers for single-phase flow and with an electrical evaporator for boiling conditions. (C) 2004 Elsevier B.V. All rights reserved.