A water-cooled two stroke engine including a cylinder formed with an exhaust port which is adapted to be cyclically closed by a piston reciprocating in the cylinder. The exhaust port is provided at the upper portion with a port timing control valve which is operated to control the port timing in accordance with the engine speed by a piston-cylinder type actuator. The actuator is adaped to be operated by the engine cooling water pressure and has an operating pressure chamber at one side of the piston and a compensating pressure chamber at the other side. The cooling water supply passage has a flow restriction and the pressure upstream of the restriction is introduced into the operating pressure chamber and that downstream of the restriction into the compensating pressure chamber.