Abstract: It is known that the performance of an underwater acoustic equipment closely depends on the acoustic R-T isolation of a transducer, i.e. the acoustic isolation between receiving and transmitting of the transducer. This paper introduced a new acoustic isolation system, in which the design of an acoustic baffle was changed so that the transducer's R-T leakage decreased obviously. A method of advancing the acoustic R-T isolation was presented according to the dipole theory. The effectiveness of this method was evaluated and verified by the finite element simulation. Based on the simulation model, an acoustic isolation prototype system with an acoustic R-T isolation greater than 40dB in an octave was developed which significantly improved the performance of an existing underwater acoustic target simulator.