Transient temperature behavior in a wellbore develops as a result of heat exchange between fluid in the wellbore and surrounding formation as the hot fluid from reservoir moves upward in production, or vice versa during injection. Previous models based upon steady-state mass flow rate or semi-steady state heat transfer cannot be applied for many practical scenarios such as variant production rates and deep water flow assurance management, to give accurate results which are critical in many decision-making situations. The objective of this thesis is to discuss the transient temperature behavior in the wellbore and surrounding formation and its impact on hydraulic fracturing. In this paper, an efficient and accurate model for both the wellbore and the formation is developed using finite-difference method. The model is based upon the first principle of hydrodynamics and thermodynamics, and accounts for transient mass flow as well as thermal transfer to compute the temperature profile at any specific time and location during production. After model validation using Ramey’s semi-analytical solution and Wu’s transient heat transfer model, the model was used in a real deepwater production field to understand the impact of well production history on temperature. The simulation results indicate that not only the well shut in duration, production time, but also the flow rate history affect temperature transverse the wellbore. Then the model is coupled with a fracture propagation model to study the temperature impact on hydraulic fracturing. Factors being considered include the rheology change on fracking fluid and the stress state change in the wellbore and formation. The temperature impact is shown by comparing the growth of fracture half-length and fracture width with a normal fracture model. Both the single vertical fracture case and multistage hydraulic fracturing case are discussed.