A numerical simulation was conducted by using discrete element method and granular heat conduction model to investigate the heat transfer mechanism inside a horizontal rotating drum. A particulate system containing binary-size spherical particles heating up through the wall was considered as the simulation domain. Radial segregation phenomenon and heat transfer of the particulate system were considered simultaneously. The effects of binary-mixture parameters such as volume ratio (the volume ratio of the small particles to all particles) and diameter ratio (the ratio of large to small diameter of particles) on the heat transfer were investigated. It was found that increasing the volume ratio of small particles causes faster heat up of the particulate bed. Conversely, higher diameter ratios led to lower heat transfer. The temperature difference between small and large particles was more obvious in the case of segregation, and the bed became more thermally non-uniform, particularly in the case of high diameter ratios. Moreover, the effects of important parameters such as rotation speed and filling level, on the heat transfer of the bed were also studied. The results showed that heat transfer rate is in direct relation with rotation speed, but it is inversely related to filling level in the binary-size bed.