A two-phase reaction model of the secondary combustor was established to study the effect of water-fuel ratio on engine performance of magnesium-based water ramjet with twice water penetration. The change tendency of specific impulse, temperature and velocity of nozzle exit were obtained with water-fuel ratio. Direct-connected tests were carried out in order to validate the correctness of the numerical simulation. The result shows that there exists the optimum water-fuel ratio, which can improve the performance of water ramjet.