A two-dimensional two-phase steady state model of the cathode of a polymer electrolyte membrane fuel cell (PEMFC) is developed using unsaturated flow theory (UFT). A gas flow field, a gas diffusion layer (GDL), a microporous layers (MPL), a finite catalyst layer (CL), and a polymer membrane constitute the model domain. The flow of liquid water in the cathode flow channel is assumed to take place in the form of a mist. The CL is modeled using flooded spherical agglomerate characterization. Liquid water is considered in all the porous layers. For liquid water transport in the membrane, electro-osmotic drag and back diffusion are considered to be the dominating mechanisms. The void fraction in the CL is expressed in terms of practically achievable design parameters such as platinum loading, Nafion loading, CL thickness, and fraction of platinum on carbon. A number of sensitivity studies are conducted with the developed model. The optimum operating temperature of the cell is found to be 80-85 °C. The optimum porosity of the GDL for this cell is in the range of 0.7-0.8. A study by varying the design parameters of the CL shows that the cell performs better with 0.3-0.35 mg cm-2 of platinum and 25-30 wt% of ionomer loading at high current densities. The sensitivity study shows that a multi-variable optimization study can significantly improve the cell performance. Numerical simulations are performed to study the dependence of capillary pressure on liquid saturation using various correlations. The impact of the interface saturation on the cell performance is studied. Under certain operating conditions and for certain combination of materials in the GDL and CL, it is found that the presence of a MPL can deteriorate the performance especially at high current density. © 2010 Elsevier B.V. All rights reserved.