A new radial three-cavity structure of the coaxial virtual cathode oscillator is proposed and studied numerically in this paper. Using the radial three-cavity structure, the beam-wave conversion efficiency is enhanced by modulating the E-field in the beam-wave interaction area, whereas the resonator composed of the radial three-cavity configuration and the mesh anode helps restrain mode competition efficiently. Also, the output microwave power is improved by the coaxial extraction structure in respect that it benefits the energy extraction and it absorbs the used electrons entering the drifting tube. With an electron beam of 400 kV and 50 kA, a peak instantaneous power about 6 GW is achieved by simulation at 4.14 GHz. The peak period-averaged power reaches 2.45 GW and the beam-wave convers