In this study, numerical simulations of two-phase flow in a transonic compressor rotor (NASA rotor 37) were performed. Both flow and droplets' governing equations were formulated and solved in the reference frame of the rotating blades. An Eulerian-Lagrangian approach was used for the continuous and discrete phases with a two-way interaction model to simulate the mass-, momentum-and energy exchange between the different phases. Water particles were injected at the inlet with uniform particle mass flux, fully evaporating inside the rotating blade row. The phase change was most intense in areas adjacent to shock waves, where the slip velocity of the droplets was the highest. Results show decreased circumferentially averaged total temperature ratio of the air-vapor mixture across the span, which is the direct result of inter-phase energy coupling. An entropy based approach to calculate the isentropic efficiency of a wet compression process in a transonic compressor rotor was also presented. Under the proposed method, the viscous dissipation function was calculated everywhere in the domain in the post-processing phase of the numerical simulation and integrated to the wall, with special treatment in the nearwall regions where high rates of entropy generation occur. For a water to air mass flow ratio of 1% results show increased entropy production across the span, resulting in a 5% drop in compressor isentropic efficiency. Analytical integration of wall functions and numerical integration of the viscous dissipation function allows for reasonable results even with relatively coarse grids and can also be applied for single-phase flows. A parametric study of the effect of initial particle parameters on the wet compression process was also performed. Several speedlines have been computed with different amounts of water, especially near the tip. Results show that numerical stall can be delayed with injection of water near the tip, due to the increase of the axial momentum of the fluid in the endwall region, which is the direct result of phase change.iv v ACKNOWLEDGEMENT