In this study, the Fe-based powder metallurgy (Fe-PM) brake pad was paired with a cast steel brake disc to conduct braking tests on a full-scale flywheel braking dynamometer. We systematically analyzed the morphologies of the worn surfaces and the disc temperatures during braking, uncovering the friction and wear characteristics of the friction pair. As well as highlighted the changes in contact status between the friction pair throughout the braking process, which further affected the pad wear rate and thermal fatigue damage to the brake disc. The wear rate of the pad was 0.16 cm3/MJ during the braking tests at an initial brake speed (IBS) of 250 km/h. However, it rapidly increased to 0.66 cm3/MJ as the IBS rose to 380 km/h, indicating a severe decline in wear resistance as the speed increased. The curves of the instantaneous coefficient of friction (COF) displayed significant fluctuations throughout the single braking process and got more pronounced with the increase in the IBS, similar phenomena also occurred on the measured temperature during each braking test. These were caused by the constant changing of the contact status arose by dynamic equilibrium of the formation, spalling, and regeneration for the third body layer (TBL) on the contact surfaces. Additionally, the changing of the contact status also resulted in an uneven distribution of temperature on the disc surface, which in turn generated a temperature gradient and thermal stress. Concurrently, as the braking continued, high frequency alternating thermal stress (HFATS) on the disc surface was induced by the continuously changing contact status, which was confirmed by finite element method (FEM) simulation. As a result, the brake disc would undergo thermal fatigue after fewer braking cycles, and thermal cracks would appear on the disc surface.