In order to improve the curving performance of the conventional wheelset in sharp curves and resolve the steering ability problem of the independently rotating wheel in large radius curves and tangent lines, a differential coupling wheelset (DCW) was developed in this work. The DCW was composed of two independently rotating wheels (IRWs) coupled by a clutch-type limited slip differential. The differential contains a static pre-stress clutch, which could lock both sides of IRWs of the DCW to ensure a good steering performance in curves with large radius and tangent track. In contrast, the clutch could unlock the two IRWs of the DCW in a sharp curve to endue it with the characteristic of an IRW, so that the vehicles can go through the tight curve smoothly. To study the dynamic performance of the DCW, a multi-body dynamic model of single bogie with DCWs was established. The self-centering capability, hunting stability, and self-steering performance on a curved track were analyzed and then compared with those of the conventional wheelset and IRW. Finally, the effect of coupling parameters of the DCW on the dynamic performance was investigated.