The cracking of on-board hydrocarbon fuels is a strong endothermic reaction and can provide an additional chemical heat sink in the cooling process of the hypersonic vehicle. However, the cooling capacity of current hydrocarbon fuels can hardly meet the cooling requirements of the hypersonic vehicle at higher flight speeds. Blending ethanol is an effective method to improve the chemical heat sink of hydrocarbon fuels, but the mechanism of ethanol on chemical heat sink is unclear. In this study, n-decane was selected as a model compound of hydrocarbon fuels to investigate the physical and chemical effect of ethanol on the chemical heat sink of n-decane cracking by analyzing the chemical reactions involved through experimental study and chemical dynamic simulation. The results indicate that there is an optimum ethanol blend ratio to achieve the maximum chemical heat sink. The carbon monoxide methanation reaction which is an exothermic reaction can deteriorate endothermic process at 300–375 °C. With ethanol blending ratio above 20 wt%, ethanol vaporization deteriorates chemical heat sink by reducing the residence time in the temperature range of 225–250 °C. Pressure can suppress the reduction of residence time caused by ethanol evaporation and also suppress the positive reaction of ethanol cracking. The kinetic model of ethanol and n-decane mixture cracking was established. The calculated results verify that ethanol cracking (C2H5OH=CO+CH4+H2) and methane cracking (CH4=C+2H2) are dominant reactions in ethanol-assisted n-decane thermal cracking below 475 °C.