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Due to the low cost of the battery cells and excellent performance at ambient temperature, Lithium-ion (Li-ion) battery is a promising technology for propulsion applications. However, the performance of Li-ion batteries erodes drastically at extreme temperatures (above 65 °C or below 0 °C). Therefore, in order to maintain battery life and performance, it is crucial to keep the batteries within the temperature range where their operating characteristics are optimal. The need for expensive and complex thermal management systems has in fact kept the Li-ion technology from becoming the first choice for Hybrid Electric Vehicle (HEV) applications. In this paper, we propose a Phase Change Material (PCM) for the temperature control. Due to its high heat capacity, PCM absorbs the heat dissipated by the battery. As long as the heat emitted by the battery does not melt the PCM completely, the system is stable.