An immersion cooling system includes a receiving member, a heat dissipation channel, and a heat sink. The receiving member is filled with coolant. The receiving member is connected to an end of the heat sink, and heat-generating entities such as one or more servers are positioned in a cavity of the receiving member. The heat dissipation channel is connected to the cavity and is connected to the heat sink. The heat dissipation channel communicates with the cavity and allows circulation of the coolant in the channel, the heat sink cooling down the coolant flowing into heat dissipation channel from the cavity. The immersion cooling system is compact, occupies very little space, and is easily installed, maintained, and moved. A server system having the immersion cooling system is also disclosed.