The ongoing trend toward high-power and miniaturized electronic devices has raised increasingly stringent requirements for the high-temperature electrical properties of epoxy encapsulating materials. In this study, epoxy-terminated phenyltrisiloxane (ETS) is used as a functional monomer to incorporate Si-O bonds into bisphenol-A epoxy resin through crosslinking reactions, thereby systematically investigating the influence and modulation effects of ETS on the structure and high-temperature electrical characteristics of epoxy composites. Gel content measurements indicate that as the concentration of ETS increases, the gel content of the epoxy resin composite decreases accordingly, suggesting that higher ETS content reduces the crosslinking density of the epoxy network. Experimental test results demonstrate that compared with pure epoxy resin, the composite with 2.5% ETS exhibits superior performance: the glass transition temperature increases to 129 ℃ with thermal decomposition temperature rising, while showing optimal high-temperature (70 ℃) electrical properties including significantly reduced conductivity, markedly suppressed space charge accumulation, deepened trap energy level (from 0.834 eV to 0.847 eV), reduced dielectric loss (0.005 at 50 Hz), and improved breakdown strength (74.2 kV/mm). Notably, as the ETS content increases, the electrical properties of epoxy composite follow a non-monotonic concentration dependence, initially enhancing then deteriorating, exhibiting evolutionary characteristics similar to those of nanoparticle-modified systems. Herein, a competitive mechanism between the epoxy network structure and intrinsic properties of ETS is proposed to explain this phenomenon: at low concentrations, the original C—C network dominates, where the intrinsic properties of ETS are constrained by the host matrix, leading to improved thermal stability. Simultaneously, the bandgap difference between ETS and DGEBA establishes charge barriers that can enhance insulation performance. However, at higher concentrations, the reduced crosslinking density and increased free volume caused by reactivity and structural mismatch between ETS and DGEBA ultimately lead to performance degradation. This study offers crucial theoretical insights into and produces the design strategies for developing high-performance siloxane-modified epoxy encapsulants.