In the 5G system, multiple-input multiple-output (MIMO) antennas for both transmitting and receiving ends are required. However, the design of MIMO antennas at the 5G upper band is challenging due to the mutual coupling issues. Many techniques have been proposed to improve antenna isolation; however, some of the designs have impacts on the antenna performance, especially on the gain and bandwidth reduction, or an increase in the overall size. Thus, a design with a detailed trade-off study must be implemented. This article proposes a new C-shaped parasitic structure around a main circular radiating patch of a MIMO antenna at 16 GHz with enhanced isolation features. The proposed antenna comprises two elements with a separation of 0.32λ edge to edge between radiation parts placed in a linear configuration with an overall dimension of 15 mm × 26 mm. The C-shaped parasitic element was introduced around the main radiating antenna for better isolation. Based on the measurement results, the proposed structure significantly improved the isolation from −23.86 dB to −32.32 dB and increased the bandwidth from 1150 MHz to 1400 MHz. For validation, the envelope correlation coefficient (ECC) and the diversity gain (DG) were also measuredas 0.148 dB and 9.89 dB, respectively. Other parameters, such as the radiation pattern, the total average reflection coefficient and the mean effective gain, were also calculated to ensure the validity of the proposed structure. Based on the design work and analysis, the proposed structure was proven to improve the antenna isolation and increase the bandwidth, while maintaining the small overall dimension.