Recently, interests have been increasing towards applying the high-order methods to various engineering applications with complex geometries [30]. As a result, a family of discontinuous high-order methods, such as Discontinuous Galerkin (DG), Spectral Volume (SV) and Spectral Difference (SD) methods, is under active development. These methods provide high-order accurate solutions and are highly parallelizable due to the local solution reconstruction within each element. But, these methods suffer from the Gibbs phenomena when discontinuities are present in the flow fields. Various types of limiters [43,44,45] and artificial viscosity [46,48] have been employed to overcome this problem.A novel hybrid spectral difference/embedded finite volume method is introduced in order to apply a discontinuous high-order method for large scale engineering applications involving discontinuities in the flows with complex geometries. In the proposed hybrid approach, the finite volume (FV) element, consisting of structured FV subcells, is embedded in the base hexahedral element containing discontinuity, and an FV based high-order shock-capturing scheme is employed to overcome the Gibbs phenomena. Thus, a discontinuity is captured at the resolution of FV subcells within an embedded FV element. In the smooth flow region, the SD element is used in the base hexahedral element. Then, the governing equations are solved by the SD method. The SD method is chosen for its low numerical dissipation and computational efficiency preserving high-order accurate solutions. The coupling between the SD element and the FV element is achieved by the globally conserved mortar method [56]. In this paper, the 5 th -order WENO scheme with the characteristic decomposition is employed as the shock-capturing scheme in the embedded FV element, and the 5 th -order SD method is used in the smooth flow field. The order of accuracy study and various 1D and 2D test cases are carried out, which involve the discontinuities and vortex flows. Overall, it is shown that the proposed hybrid method results in comparable or better simulation results compared with the standalone WENO scheme when the same number of solution DOF is considered in both SD and FV elements.