Rotary valve is mostly used as a control valve in hydraulic steering system. The existences of flow separation, cavitation and other phenomena in hydraulic steering system usually generate flow noise. Reynolds averaged Navier-Stokes (RANS) equations, Rayleigh cavitation model and RNG k-ε turbulence model equations governing the flow field hydraulic steering system were solved with finite volume method (FVM) based on unstructured mesh and the compressibility of hydraulic oil was taken into account. The flow characteristics of rotary valve with different relative angle between spool and valve body, the different diameters and length of outlet pipe entrance, the relative angle between the axis of outlet pipe and valve body were analysed. Results show that the design of the axis of outlet pipe intersecting to the axis of valve body, an appropriate diameter and short entrance of outlet pipe can reduce the risk of cavitation generation in rotary valve.