For aerodynamic cleanliness, Heinkel's chief designer, Siegfried Gunter decided to dispense with the usual system of drag-producing engine radiators and to employ a surface evaporative cooling system. Such surface cooling - in the form of simpler surface radiators instead - had been used on British high speed racing seaplanes as early as 1929. This sort of system was also pioneered on the He 119, and was also intended for use on the He 100 high-speed fighter project. In this system the coolant water is pressurized, raising the coolant's boiling point, in this case about 110°C (230°F). As the superheated water leaves the engine it enters an expansion area where the pressure drops and the water flashes to steam. The steam is then cooled by running in pipes along the outer skin of the fuselage and wings.

Before the design of the He 177 was finalized, it was clear that in practice such a system would be incapable of dealing with the vast amount of heat generated by each of the twinned pairs of DB 601 powerplants. As a result, the evaporative cooling system had to be abandoned in favor of conventional annular radiators fitted directly behind each propeller. These resembled, but were larger than, those fitted to the Junkers Ju 88 A bomber. These radiators added significantly to the He 177's weight and drag.