In the present study, a ferrofluid based cooling technique was developed for a photovoltaic panel (32 solar PV cells) in order to enhance its electrical efficiency at higher operating temperature. The cooling system was consisting of mini channels of 5 mm × 5 mm square cross section at the back of the PV panel through which ferrofluid was flowing in the presence of magnetic field. The I−V characteristics and power output of the PV panel were measured with and without cooling. Results under different conditions are compared in terms of average temperature and electrical output of the PV panel. The maximum electrical output of the PV panel integrated with the designed ferrofluid based cooling method is observed to increase by 36% as compared to the case of no cooling.