Abstract: A propulsion unit for a waterborne vessel comprises: an electrically powered outrunner motor having a stator and a rotor, the rotor being configured for rotation around the stator about a stator axis; a plurality of propeller blades fixed to the rotor for rotation therewith about said stator axis; first and second components forming part of or being fixed to the stator, the first and second components being spaced apart along said stator axis with the rotor being located axially between the first and second components; a first rotary seal located between the first component and an opposed first end surface of the rotor; and a second rotary seal located between the second component and an opposed second end surface of the rotor, wherein the first and second rotary seals are configured to substantially prevent the ingress of water into a rotor-stator gap.