An electronic device with a power management mechanism and a power management method thereof are disclosed. The electronic device includes a multi-core processor and a temperature sensor. The multi-core processor has a plurality of processor cores. The temperature sensor is coupled to the multi-core processor. The temperature sensor detects the temperature of the multi-core processor and determines whether the electronic device enters an underclocking mode from a performance priority mode according to the detected temperature. When the temperature of the multi-core processor is greater than a first temperature threshold, the multi-core processor controls the electronic device to enter a first underclocking mode and dynamically adjusts an enabled core number. When the temperature of the multi-core processor is greater than a second temperature threshold, the multi-core processor controls the electronic device to enter a second underclocking mode. The first temperature threshold is smaller than the second temperature threshold.