Some important magnetic conductors, pneumatic valves and hydraulic valves made of corrosion-resistant alloy Cr16Fe (1J116) are often applied in harsh environments. However, it is very challenging to machine the inner-walled ring grooves that broadly exist in these workpieces. Electrochemical machining (ECM) is regarded as an ideal manufacturing technology to machine this kind of structure without residual stress, metamorphic layers or microcracks. However, the inner-walled ring grooves machined with ECM with the typical cylindrical cathode are shaped like a little drum and are not flat at the bottom. In this paper, a working-surface curvature cathodic modification and numerical simulation method is proposed to solve this problem. First, the working surface of the cathode is modified into an inward curved surface and is used in the flow field simulation model in which the k-epsilon equation is employed. Then, the coupling analysis of the flow field and the electric field is carried out with COMSOL Multiphysics. The simulation results show that the machining quality of the inner-walled ring groove is improved with the modified cathode because the flow field distributions and the electric field distributions in the machining gap are more uniform than before. Finally, verification experiments with the modified cathode are conducted. The experimental results show that the machined inner-walled ring groove is of good quality, and the bottom of the groove is flat. The experimental results agree with the simulation results. This study is meaningful to provide a probable solution to improve the machining quality of the inner-walled structure workpieces without residual stress, metamorphic layers or microcracks.