A soundproof type water-cooled engine generator is constructed to guide an exhaust current of air from a cooling fan of a water-cooled engine to an independent hood-like shroud chamber, deaden the current sound through a muffler located under the shroud chamber, for improving the cooling performance. A water-cooled engine 2 and a generator 3 are accommodated in a soundproof bonnet 1. A panel wall 8 is provided close to a fan 7 equipped in the water-cooled engine. The panel wall serves to partition the soundproof bonnet 1 into an engine and generator chamber 11 and an exhaust processing chamber 12. The panel wall has a hole having the substantially same diameter as the fan 7. Around the outside of the hole, a shroud chamber 17 is independently provided in the exhaust processing chamber. The shroud chamber 17 is formed by a hood-like encircling wall 14. On the lateral side of the shroud chamber, a radiator 13 is located to stand upright. A muffler is located under an exhaust duct chamber 18 so that the exhaust is discharged from the upper portion of the exhaust duct chamber.