CFD (computational fluid dynamics) is used to predict the thermal performance of a small closed-wet cooling tower to generate cold water for chilled ceiling systems. The CFD technique involves the simulation of two-phase flow of gas and water droplets. Certain simplifications are made with regard to the cooling device to overcome limitations in the CFD software employed. For example, the tubes for the heat exchanger are considered to be independent entities with a uniform surface heat flux. The simulated thermal performance is compared with experimental measurement. It is shown that the thermal performance of the cooling tower can be predicted when chilled water in the heat exchanger flows at the design rate. However, when the flow rate of chilled water is much lower than the design value, in order to predict the thermal performance, appropriate measures are required to compensate for the simplifications so that air flowing through the heat exchanger is not over-saturated.