Temperature increases in photovoltaic (PV) panels are one of the primary issues preventing PV systems from being used extensively. When a photovoltaic module overheats, its output power performance drops by 0.4%–0.5% for every degree Celsius above its rated temperature. Lowering the operating temperature of the PV surface using a cooling medium is an efficient technique to increase electrical performance and decrease the rate of thermal degradation of a PV module. To prevent this performance loss, researchers have worked on cooling photovoltaic panels with fluids such as air, water, and nanofluids. In this study, the effects of cooling on photovoltaic panels with water and nanofluid were investigated. The experiment was carried out by fixing the pipe and fins to the back surface of the panel. Al2O3‐water and TiO2‐water nanofluids were used as working fluid due to their cost effectiveness. Nanofluids prepared in three different volumetric fractions (0.01%, 0.1%, and 1%), the current and voltage values obtained from the panels were recorded, and the panel efficiency was calculated. The experimental results showed that the cooling increased the panel voltage and decreased the current. The results indicated that using TiO2 nanofluid was more effective than Al2O3 nanofluid in terms of electrical efficiency. It was also found that the fluids prepared as 0.01% and 1% gave the most efficient results. It has been observed that it is possible to increase the panel efficiency by 8.32% by cooling the panel.