Water management in cathode catalyst layer (CCL) plays an important role in the PEM fuel cell operation. A novel anti-flooding CCL is developed with the addition of oxygen permeable and hydrophobic dimethyl silicone oil (DSO) into the catalyst layer (CL) to improve the water balance and oxygen transport within the cathode. With the addition of 0.5 mg cm-2 DSO in the CCL, the ability of water management has been enhanced greatly compared to that with a normal cathode. Electrochemical impedance spectroscopy has been employed to characterize the electrochemical behavior of the single fuel cell. The results show that the increased hydrophobicity of the CCL by DSO modification effectively expels water out of the voids of CCL. In addition, DSO in the CCL enhances oxygen accessibility to the CCL, thus improving the performance of the PEM fuel cell significantly.