This work examines the thermal-hydraulic performance of Al₂O₃-water nanofluids inside a backward-facing step (BFS) configuration characterized by insulated hot walls and semi-circular grooves, employing computational fluid dynamics (CFD) simulations in ANSYS Fluent. The main objective is to analyze the effects of nanoparticle concentration (2 %, 4 %, and 6 % by volume) and flow Reynolds number (10–250) on heat transfer and flow dynamics, with an emphasis on improving thermal management systems. The study primarily examines the lack of comprehension of nanofluid behavior in BFS geometries under laminar flow circumstances and investigates the correlation between flow recirculation, reattachment processes, and thermal boundary layer attributes. The findings indicate that elevated Reynolds numbers and nanoparticle concentrations markedly enhance heat transfer rates, with thermal convection coefficients rising by approximately 1.031, 1.063, and 1.096 times for 2 %, 4 %, and 6 % nanofluid concentrations, respectively, in comparison to the base fluid. The findings offer significant insights for enhancing thermal systems, including heat exchangers and cooling devices, with recommendations for further research in turbulent regimes and different geometries. This study enhances the existing research on nanofluid uses in sophisticated thermal management systems.