The effect of entrained air in the hydraulic brake system of a platoon vehicle in a controlled braking manoeuvre was theoretically investigated. The actuator dynamics with the load inertia was considered, and non-linear and linearized system equations were derived in dimensionless form. It was found that the principal resonant critical frequency decreases as a result of the entrained air, and that the resonant peak amplitude increases as the air content increases. The decreased resonant frequency leads to a reduction in the bandwidth of the brake actuator. A stability criterion for the system reveals that the entrained air reduces the allowable open-loop gain, diminishing the stability in a closed-loop system. Numerical simulations for frequency response show that even small amounts of entrained air could drastically affect the braking performance.