A flywheel energy conversion device (10) provides highly efficient conversion between kinetic and electrical energy. The flywheel (10) produces increased output by providing armature coils (44) in an air gap (46) formed about the flywheel (both radial and axial embodiments are described). In preferred embodiments, field coils (30, 32) of a magnetic circuit are energized with DC drive current that creates homopolar flux within a rotating solid rotor (12) having teeth (14) cut from a flat disk. The total reluctance of the magnetic circuit and total flux remain substantially constant as the rotor rotates. The flux may travel radially outward and exit the flat disk through the teeth (14) passing across an armature air gap (46). Air gap armature coils (44) are preferably utilized in which the changing flux density (due to the rotating teeth) induces an output voltage in the coils. The flux is diffused before returning to the rotor in one of several ways such that core losses are effectively reduced, thereby enabling the flywheel to operate efficiently at high frequencies.