With frequent overloads and extreme summer temperatures, faults from internal overheating of oil-immersed transformers are increasing. Conventional mineral oil struggles to dissipate heat under extreme conditions. Nano-modified mineral oil is crucial for efficient heat dissipation of windings and iron cores, ensuring stable operation. This paper presents a numerical model of convective heat transfer in oil-immersed transformers using the finite element method, analyzing heat transfer under normal conditions (300 K external temperature, rated load) and extreme conditions (313 K external temperature, 1.2 times overload current) with 25# and nano-modified transformer oils. Results show that nano-modified oil reduces the low-voltage winding’s maximum and hotspot temperature differences by 1.2 K and 1.3 K under normal conditions, and 3.6 K and 3 K under extreme conditions. Nano-modified mineral oil significantly improves heat dissipation, especially in extreme conditions, lowering the low-voltage winding’s average temperature by 3.53 K and the hotspot temperature by 3 K. These findings provide valuable insights into enhancing transformer heat dissipation with nano-modified mineral oil.