A micro-machined underwater acoustic receiver that utilizes the flexural vibration mode of a silicon thin plate and piezoelectric transduction material was investigated. In particular, air was used as the backing material for the hydrophone in order to improve sensitivity in the audible frequency range. To evaluate the effects of air backing on receiving sensitivity, a transduction model incorporating mechanical/electrical/acoustical design parameters was used in designing a piezoelectric micro-machined hydrophone. The sensitivity and displacement responses of the sensor were simulated using the model for air backing and water backing cases, and the benefit of using air backing to enhance sensitivity was confirmed. The micro-machined piezoelectric transducer was fabricated, assembled in the shape of a hydrophone, and tested to ascertain its characteristics as an underwater sensor. These characteristics, such as frequency response and sensitivity, were measured and compared with the simulated results.