A modeling study is conducted to investigate the plasma flow and heat transfer characteristics of low-power (kW class) arc-heated thrusters (arcjets) with 2:1 hydrogen/nitrogen to simulate decomposed hydrazine as the propellant. The all-speed SIMPLE algorithm is employed to solve the governing equations, which take into account the effects of compressibility, the Lorentz force and Joule heating, as well as the temperature- and pressure-dependence of the gas properties. Typical computed results about the temperature, velocity and Mach number distributions within arcjet thruster are presented for the case with arc current of 9 A and inlet stagnant pressure of 3.3×105 Pa to show the flow and heat transfer characteristics. It is found that the propellant is heated mainly in the near-cathode and constrictor region, with the highest plasma temperature appearing near the cathode tip, and the flow transition from the subsonic to supersonic regime occurs within the constrictor region. The effect of gas viscosity on the plasma flow within arcjet thruster is examined by an additional numerical test using artificially reduced values of gas viscosity. The test results show that the gas viscosity appreciably affects the plasma flow and the performance of the arcjet thruster for the cases with the hydrazine or hydrogen as the propellant. The integrated axial Lorentz force in the thruster nozzle is also calculated and compared with the thrust force of the arcjet thruster. It is found that the integrated axial Lorentz force is much smaller than the thrust force for the low-power arcjet thruster. Modeling results for the NASA 1-kW class arcjet thruster with simulated hydrazine as the propellant are found to be reasonably consistent with available experimental data.