This paper presents an analysis of the heat transfer behavior of a three-phase distribution transformer filled with nanofluid. The effect of thermophoresis and Brownian motion is incorporated into the governing equations, thus giving the non-homogenous mathematical model for the nanofluid flow. The results show that in presence of the temperature gradient in a distribution transformer, the nanoparticle volume fraction greatly reduces near the heated wall and consequently modifies the net oil flow in the transformer, owing to reduction in oil viscosity near the heated wall. The results of the complete analysis of the temperature and the velocity field distribution of nanofluid flow show an increased heat transfer in both the natural and forced convection; the increase is relatively higher in former, in the light of thermophoresis effect and Brownian motion. Further, the results of the parametric study show that nanofluid dispersed with the magnetite nanoparticles has higher reduction in maximum temperature ( 11 K) followed by silica nanoparticles ( 7.3 K) and quartz nanoparticles ( K). The maximum reduction in temperature increases to 13 K in magnetite nanofluid under the influence of electric and magnetic field while it remains unchanged in silica nanofluid.