Photovoltaic solar cells convert light energy from the sun into electricity. Photovoltaic cells are produced by semi-conducting materials to convert the energy into electricity and during this process heat is absorbed by the solar radiation. This heat causes a loss of electricity generation efficiencies.In this study, an experimental setup was designed and established to test two separate photovoltaic panel systems with alone PV and with water cooling system PV/T to examine the heat effect on PV systems. The absorbed heat energy behind the photovoltaic cell's surface in insulated ambient was removed by means of a water cooling system and the tests for both systems were simultaneously performed along the July 2011. It is found that without active water cooling, the temperature of the PV module was higher during day time and solar cells could only achieve around 8% conversion efficiency. On the other hand, when the PV module was operated with active water cooling condition, the temperature dropped significantly, leading to an increase in the efficiency of solarcells as much as 13.6%. Gained from absorbed solar heat and maximum thermal conversion efficiencies of the system are determined as 49% and 51% for two different mass flow rates. It is observed that water flow rate is effective on the increasing the conversion efficiency as well as absorption and transitionrates of cover glass in PV/T (PV-Thermal) collector, the insulation material and cell efficiency. As a conclusion, the conversion efficiency of the PV system with water cooling might be improved on average about 10%. Therefore, it is recommended that PV system should be designed with most efficient type cooling system to enhance the efficiency and to decrease the payback period. © Owned by the authors, published by EDP Sciences, 2013.