Heavy-duty vehicles are generally equipped with non-contact hydraulic retarders or eddy current retarders to ensure safe driving during downhill conditions. The torque of the hydraulic retarder is large when the rotor rotates at a high speed, but the torque is small when the rotor rotates at a low speed. As another commonly used retarder, the eddy current retarder has a large torque at a low speed and a low power density at a high speed. High torque at full speed is the vehicles' requirement for the auxiliary brake system, with no retarders can achieve this goal perfectly alone. Encouragingly, the braking performances of these two kinds of retarders are complementary. Based on the above properties, the eddy current-hydraulic hybrid retarder (EHR) is designed applying the principle of eddy current and the principle of hydraulic braking. In this novel HER, both sides of the rotor are used for hydraulic braking, and the outer ring of the rotor generates eddy currents. The finite element models of the flow field and the electromagnetic field are established separately and solved by computer to predict the braking torque of the EHR. The prototype was developed and the braking performance of the EHR was obtained through the bench tests. Comparing the theoretical calculation results and experimental data, the braking characteristics of the EHR are analyzed. At low speed, the EHR mainly relies on the eddy current braking, whereas at high speed, it relies on both eddy current and hydraulic braking. Moreover, the control of the EHR can be realized only by adjusting the braking torque of the eddy current part, which simplifies the control system.