Recently, the erosion due to cavitation frequently occurs on a horn-type rudder of a high-speed large container carrier. It is necessary to understand the flow characteristics around a rudder in fully wetted and cavitating flow condition, and the process of generation and collapse of cavitation for a rudder design to minimize the cavity-induced erosion. The flow characteristics around a two-dimensional hydrofoil(NACA66) are investigated through the computational method utilizing a viscous flow theory applied to a cavitation model. The computational results from the viscous flow theory are verified by the comparison with the experimental results, and are compared with those from the potential flow theory. The effects of angle of attack, Reynolds number, cavitation number, and thickness ratio on the cavitating flow are also investigated.