The choice of a proper cooling system and its correct sizing is a key factor when designing a battery pack for a certain application. This influence performance, costs, safety, and lifetime of the battery pack and therefore of the full system. Among all possible methods, the so-called active immersed cooling has not yet been thoroughly investigated and considered in the literature by date due to multiple factors. To evaluate its technical viability and efficiency, a thorough analysis and investigation of a battery pack equipped with this cooling concept is presented in this work. Herein, we present the first experimental study on a novel compact immersion cooling system for cylindrical battery cell packs based on the 3M Novec 7200 cooling fluid. To analyze and quantify the degradation behavior on battery pack level in homogeneous and non-homogeneous temperature conditions, two identical battery packs composed of 25 cylindrical 18650-type cells are cycled until End-of-Life condition using different thermal management strategies, namely air cooling and active immersed cooling. The results show for the first time on one side the quantitative different degradation behavior of the two packs, on the other side the different energy throughput due to the different temperature distribution. Different key performance figures are analyzed to understand different observed phenomena, such as appearance of different degradation modes and inhomogeneous cell capacity fade. Following investigation concentrates on analyzing single cell degradation state after the pack’s disassembly: characterization of some of the cells (which have shown different behavior during degradation) by means of differential analysis and post-mortem analysis allows for the identification of the most relevant aging processes and their relation to the presence of temperature gradients inside the battery pack.