There are a series of disadvantages in tungsten alloy (TA), which is adopted as the jacket of PELE widely at present, such as inadequate obdurability, uncontrollable shape and amount of fragments, imperfect lateral damage effect, and so on. To solve the problem, tungsten fiber composite (TFC) is brought forward to produce PELE jacket. In order to verify its feasibility, numerical simulations are carried out on PELE impacting armor steel target with TFC jacket. The simulation results are compared with that of PELE with TA jacket and the reasons that the penetrating performance and lateral damage effect of PELE with TFC jacket being superior is discussed. After that, the function mechanism of PELE with TFC jacket is investigated through analyzing the influences of some factors on impacting behavior of PELE projectiles. These results can provide reliable theory and computational bases for future research.