A propulsion unit includes a housing supported on a vessel. A propeller shaft extends in the housing. The propeller shaft is rotatably supported with a first bearing and a second bearing. A propeller is attached to at least one end of the propeller shaft. The first bearing includes a first radial bearing and a first thrust bearing. The first radial bearing is a sliding bearing positioned axially inside the first thrust bearing. The first bearing is positioned at the first end of the housing and the second bearing being positioned at the second end of the housing or vice a versa.