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We report a current modulation strategy that suppresses internal short circuit (ISC)-caused thermal runaway of Li-ion cells. The strategy works by guiding current flow outside a cell in the event of a serious ISC to reduce local internal heating. Using 4-Ah cells with NMC811 cathode and graphite anode, and a reliable ISC triggering and quantification method, we demonstrated that thermal runaway would start within a few seconds of Al-Anode ISC or Al-Cu ISC without current modulation. In comparison, thermal runaway was effectively suppressed with proper current modulation. Quantification through in situ diagnosis showed that current modulation reduced heat generation at the ISC location by an order of magnitude and reduced the maximum temperature dramatically. Further energy balance analysis and post-mortem analysis supported the hypothesis that the strategy of current modulation works by minimizing local heating and promoting uniform heating.