The design and tests of a LaB6 hollow cathode with a novel heater are presented. In the new design, the heater wire is completely encapsulated around the cathode tube and a coaxial return electrode, thereby eliminating hot spots on the heater wire due to the free hanging regions. Since the new heater confines the Joule heating to the region of interest, where the LaB6 emitter is placed, the heater terminals are further secured from overheating. The cathode with the presented heater design has been successfully tested and is able to deliver currents in the 0.5-15 A range. Published by AIP Publishing.