A non-ventilated motor-generator includes a rotor supported for rotation on bearings inside a closed metal housing. The rotor is constructed of two spaced apart rotor sections having permanent magnets that drive magnetic flux across an air gap between the rotor sections. An air core armature in the air gap has windings in a non-magnetic structure that is structurally coupled to the housing. The armature is thinner than the armature air gap and is positioned such that there is a physical air gap on each side of the armature. The rotor has air flow passages through which air is induced to flow, in operation, in a polloidal loop that includes a portion that passes through the armature air gap, picking up heat from the armature, and a portion that is in contact with the inside of the motor-generator housing where the heat is transferred to the housing and dissipated to the atmosphere.