The permanent magnet rotating electric machine comprising a stator with a stator coil wound on a stator iron core, a rotor with a plurality of permanent magnets disposed in the circumferential direction in a rotor iron core, which is disposed opposite to the stator iron core of the stator with a predetermined spacing therebetween and is fixed to a shaft, a water-cooling unit disposed around the outer circumference of the stator iron core, and a fan fixed to the shaft on the same side as at least one axial end of the rotor iron core to circulate cooling air in the permanent magnet rotating electric machine; further comprising ventilation paths, through which the cooling air flows, formed around the outer circumference of the water-cooling unit; wherein after the cooling air has been circulated by the fan in the machine for cooling, the cooling air is led to the ventilation paths to perform heat exchange between the cooling air flowing in the ventilation paths and the water-cooling unit, after which the cooling air is circulated again in the machine.