Abstract In recent years, the increasing occurrence of heatwaves raises the cooling need of residential buildings in Scandinavian countries, which are traditionally not equipped with active cooling systems. Indoor overheating caused by such heatwaves leads to severe consequences for occupants, especially kids and seniors. Efficient and economical cooling solutions are urgently needed to cope with frequent heatwaves. The present study investigated the novel usage of the geothermal-assisted mechanical ventilation with heat recovery (GEO-MVHR) system for cooling purposes in typical Swedish multi-family dwellings. The cooling potential of the system and its contributions to thermal comfort were evaluated. Dynamic simulations were conducted to assess the system's cooling performance under two climate scenarios: the climate of 2018 representing an extreme year with excessively hot summer and the climate of a typical meteorological year. The GEO-MVHR system shows great potential in mitigating indoor overheating with improved thermal comfort. A ventilation airflow rate of 0.50–0.70 l/s/m2 is suggested for multi-family dwellings to maximize the cooling potential of the GEO-MVHR system. The indoor operative temperature could be reduced by up to 3 °C with the GEO-MVHR system operating for cooling. Modulating the supply air temperature of the GEO-MVHR system based on indoor thermal conditions is recommended, as it shows the advantage of avoiding unnecessary overcooling and energy saving.