A kinetic energy recovery system with flywheel includes a cascade flywheel doubly-fed electric machine and an electric motor. The cascade flywheel doubly-fed electric machine has a stator end coil, a rotor end coil and a flywheel. The flywheel can store kinetic energy by increasing speed or releasing kinetic energy by decreasing speed. A control circuit has an inverter, a rectifier and a DC bus connecting the inverter and the rectifier. The inverter supplies alternating current to the rotor end coil. The rectifier has an AC end connected to the stator end coil through an AC bus. The rectifier converts alternating current to direct current, so that the inverter can draw power from the DC bus. The electric motor has a phase coil connected to the AC bus. When the cascade flywheel double-fed electric machine decelerates, the system converts mechanical energy into electrical energy.