Based on the structural features of electric vehicle driven by inwheel motor and the characteristics of low speed as well as high torque of inwheel motor, regenerative braking method for inwheel motors was presented. All braking torque for vehicle deceleration was output by inwheel motor under moderate intensity braking condition for the sake of recovering the maximum braking energy. The vehicle dynamics model that included the hydraulic braking system and the inwheel motor driving system was built by AMESim software. Simulation was carried out for vehicle driving conditions by NEDC cycle and FTP75 cycle. The results showed that the recovery rate of braking energy was increased dramatically by inwheel motor braking method. The energy efficiency of electric vehicle was improved by more than 30%.