Submerged water-jet propulsion is a new development of traditional water-jet propulsion technology. The current study systematically analyzes the propulsion efficiency, the interaction between the hull and the water-jet and the specific speed of the propulsion pump based on the concept of this type of water-jet propulsion. It firstly establishes the mathematical modelling of the specific speed and the advance coefficient of the waterjet-propelled ship that are described by principal parameters of the hull and the propulsion system. The range of the speed and the specific speed of the propulsion pump for the submerged propulsion system has been demonstrated to reveal the mechanism of high efficiency. The variation of the main parameters of the propulsion system with the speed ratio and speed of revolution has been validated through case studies. It can provide a theoretical basis for the development and application of the submerged water-jet propulsion system.