A numerical method is used to simulate the motion and coalescence of air bubbles in a micro-channel under a nonuniform electric field. The channel is equipped with arrays of electrodes embedded in its wall and voltages are applied on the electrodes to generate a specified electric field gradient in the longitudinal direction. In the study, the Navier-Stokes equations are solved by using the level set method handling the deformable/moving interfaces between the bubbles and the ambient liquid. Both the polarization Coulomb force and the dielectrophoresis force are considered as the force source of the Navier-Stokes equations by solving the Maxwell's equations. The flow field equations and the electric field equations are coupled and solved by using the finite element method. The electric field characteristics and the dynamic behavior of a bubble are analyzed by studying the distributions of the electric field and the force, the deformation and the moving velocity of the air bubble. The result suggests that the model of dispersed drops suspended in the immiscible dielectric liquid and driven by a nonuniform electric field is an effective method for the transportation and coalescence of micro-drops.