  We present the results of a {\it Chandra} observation of the central region
of Abell 3112. This cluster has a powerful radio source in the center and was
believed to have a strong cooling flow. The X-ray image shows that the
intracluster medium (ICM) is distributed smoothly on large scales, but has
significant deviations from a simple concentric elliptical isophotal model near
the center. Regions of excess emission appear to surround two lobe-like
radio-emitting regions. This structure probably indicates that hot X-ray gas
and radio lobes are interacting. From an analysis of the X-ray spectra in
annuli, we found clear evidence for a temperature decrease and abundance
increase toward the center. The X-ray spectrum of the central region is
consistent with a single-temperature thermal plasma model. The contribution of
X-ray emission from a multiphase cooling flow component with gas cooling to
very low temperatures locally is limited to less than 10% of the total
emission. However, the whole cluster spectrum indicates that the ICM is cooling
significantly as a whole, but in only a limited temperature range ($\geq 2$
keV). Inside the cooling radius, the conduction timescales based on the Spitzer
conductivity are shorter than the cooling timescales. We detect an X-ray point
source in the cluster center which is coincident with the optical nucleus of
the central cD galaxy and the core of the associated radio source. The X-ray
spectrum of the central point source can be fit by a 1.3 keV thermal plasma and
a power-law component whose photon index is 1.9. The thermal component is
probably plasma associated with the cD galaxy. We attribute the power-law
component to the central AGN.
