Computational fluid dynamics (CFD) studies are carried out on a two-bladed vertical axis wind turbine operating at a wind speed of 8 m/s for tip speed ratios (λ) of 0.50–3.0. The blade is the NACA0021 airfoil with chord length 0.265 m and rotor radius 1 m. Basic sensitivity studies for various time step sizes are carried out. The results are validated against available measurement data from the literature. Excellent agreement is obtained for small λ up to optimum condition. For the higher tip speed ratios, the two-dimensional CFD computations predict higher results than the wind tunnel experiment, but they are very similar to the field measurement data. Wake characteristics are presented, showing that the wake becomes Gaussian at 5 times radius downstream of the rotor. It is shown that complex flow phenomena occur owing to dynamic stall onset, especially for the smaller tip speed ratio.