In this paper, a compact L-band coaxial relativistic backward wave oscillator is investigated using the 2.5 D particle simulation code. Detail physical interaction pictures of the oscillator are presented. Simulation results show that the radius of the L-band slow-wave structure can be much smaller in the coaxial BWO case than that in the non-coaxial BWO case, because the TM01 mode of the coaxial BWO has no cut-off frequency, which is similar to the TEM mode in the conventional coaxial wave-guide. It is mentioned that the longitudinal component of electric field of the coaxial TM01 mode can be strong, differing from the TEM mode in the conventional coaxial waveguide. Therefore, the coaxial TM01 mode could have strong interaction with the electron beam. For an electron beam of 240 keV and 1