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This paper presents a theory for condensing fluid flow in pipes. The theory incorporates the Reynolds flux concepts, advanced by Silver and Silver and Wallis, to account for the modification of interfacial shear when a phase change occurs across an interface. The basic theory is applicable to any fluid condensing in the annular two-phase flow régime and enables good predictions to be made for the local values of phase velocity, static pressure, and amount condensed. A comparison has been made with published experimental data for steam condensing with velocities in the range 380–730 ft/s, i.e. turbulent vapour core and a laminar/turbulent condensate film. A further outcome of the comparison with experimental data is a rationalization of the Reynolds flux concept with less empirical modification.