In traditional liquid cooled internal combustion engine systems, the coolant temperature is controlled by a thermostat which governs the coolant flow rate to the radiator. The thermostat is effectively a directional control valve in which the spool displacement is used to direct flow to the radiator. The coolant temperature is primarily a function of four parameters, namely radiator and thermostat characteristics, coolant flow rate and ambient temperature. By employing closed-loop feedback, the coolant temperature can be controlled according to environmental conditions. To achieve this goal the overall system must be correctly designed. That is the issue discussed in this paper.The increasing use of simulation for both circuit and component analysis in the automtive industry has come about due to the requirement for acceptable transient as well as steady state system performance. The computer simulation package Bathfp, originally developed at the Fluid Power Centre, University of Bath, U.K., to simulate hydraulic systems, has been extended to incorporate models of components in engine cooling systems. Utilities are provided which allow a model of a complicated system or component to be built up from its elements, which can be introduced to the model library of components. Component models enable the individual effects on overall system behaviour to be assessed to a high degree of accuracy.This paper describes the use of computer simulation to assess the capabilities of the closed loop themostat system using PID control to ensure precise and stable operation. Parametric variations are made in the simulation to obtain optimum performance and identify likely problems.