The basic principles of faraday isolation and thermal effects in the rod geometry under high power operation have been reviewed. The temperature dependency of the verdet-constant and the magnetization of NdFeB have been identified as the limiting factor of isolation ratio for an unchilled high power isolator device. The focal shift due to the isolator with rod-geometry is independent from beam diameter and strongly depending on beam quality. A highly compact isolator for unpolarized radiation up to 400 W fundamental mode for industrial application surrounding with minimal thermal lensing has been developed. At 400 W and 10-40 °C a transmission of 95-97 %, an isolation larger 20 dB, a thermal focus shift of less than 2 rayleigh ranges and a M2 smaller than 1.2 have been achieved.© (2010) COPYRIGHT SPIE--The International Society for Optical Engineering. Downloading of the abstract is permitted for personal use only.