In two-fluid modeling, accurate prediction of the interfacial transport of mass, momentum, and energy is required. Experiments were carried out to obtain a data base for the development of interfacial transport models, or correlations, for subcooled water–steam bubbly flow in vertical conduits. The experimental data of interest included the interfacial area concentration, interfacial condensation heat transfer, and bubble relative velocity. In the present investigation, bubble condensation in subcooled water–steam flow in a vertical annulus at low flow rate and low pressure is investigated experimentally. A high-speed video system (up to 1000 frame/s) was used to visualize two orthogonal views of the flow simultaneously. A digital image processing technique was used to track and measure the velocity and size of the collapsing bubbles. The axial void fraction distribution was also measured by a single beam gamma densitometer. The results were compared with existing correlations and a new correlation for bubble condensation Nusselt number was obtained based on the present data. In the proposed correlation, the bubble condensation Nusselt number is expressed in terms of the bubble Reynolds number, Jakob number, and void fraction. The latter term accounts for the multi-bubble effect. This correlation can predict the present data within ±20 percent with a correlation coefficient of 96 percent.