The sealing characteristics of an annular power cylinder based on the Twin-rotor piston engine are studied, which provides a theoretical foundation for the sealing design of a new high-power density piston engine. In this paper, the basis thermodynamic realization process of an annular power cylinder is presented. The Runge Kutta equation is used to establish the coupled leakage model of adjacent working chambers under annular piston seal. And the sealing performance of the annular power cylinder is analyzed in detail. Moreover, the influence of rotor speed and compression ratio on the sealing characteristics and leakage is studied. Finally, some tests are carried out to verify the sealing principle and simulation results, which verifies the theoretical basis of simulation analysis. Results show that there are double pressure peaks in the leakage chamber between two working chambers, which is beneficial to reduce the leakage rate. Besides, increasing the speed and decreasing the compression ratio can help to reduce gas leakage. Furthermore, the effects of speed variation on the leakage are only significant when rotating at low speed. Changing the compression ratio has a greater effect on the slope of the leakage curve at a low compression ratio, and the lower the compression ratio, the better the sealing effect.