This paper reports the design of a magnetic-geared permanent magnet synchronous motor (MG-PMSM) for a 45 kW tram traction system based on high torque density. In the case of the existing tram driving system, due to mechanical reduction gear and induction motor, it causes power transmission loss, low efficiency, and difficulty in lightweight. To solve this problem, research on the MG-PMSM, which combines a contactless magnetic gear with a high-power-density PMSM, is being actively conducted. This motor has a double rotor structure, and the inner rotor, including permanent magnet, and the outer rotor composed of pole-pieces rotate at different mechanical speeds. However, it is hard to design a tram driving system with a high torque density within limited conditions, because only one rotor in MG-PMSM is used as an output. In addition, there is no study conducted from basic design to final design, including gear ratio and topology selection in MG-PMSM for tram. Therefore, this paper presents the design process of MG-PMSM with high torque density to be applied to the 45 kW–class tram driving system. After designing the magnetic gear part that increases torque and efficiency by selecting an appropriate topologies-and-gear ratio that meets the constraints, the final finite elements method (FEM) model and electromagnetic field analysis results were derived by considering the number of poles and the number of slots. Through this, we confirmed that it is superior in output characteristics compared to the existing induction motor + mechanical gear.