The inefficiency of cyclone separation for fine particulate matter is attributed to the presence of longitudinal circulating flow and short-circuit flow in the annular space. To enhance cyclone performance, a novel cyclone design called enhanced cyclone with split flow (ECSF) has been developed, which effectively suppresses circulating flow, short-circuit flow, and eccentric circulation through bypass flow and underflow. The mechanism of bypass flow on improving the annular space’s flow field is investigated using the Reynolds stress model and discrete phase model, along with an examination of the impact of annular space height. Simulation results demonstrate that bypass flow can directly counteract vertical circulation in the annular space by creating a gas partition near the vortex finder inlet to block short-circuiting. This suppression effect on both vertical circulation and short-circuiting increases with higher bypass flow ratios. Furthermore, while the presence of an annular space limits ECSF performance optimization, its elimination simplifies structure by removing the vortex finder while maximizing separation efficiency. When no annular space exists (height = 0 mm), ECSF achieves highest separation efficiencies for 10 μm and 2.5 μm particles at approximately 96 % and 83 %, respectively; energy consumption is also minimized at only 0.94 kPa. These findings lay a foundation for future application research on ECSF.