Hydrothermal multiwall closed carbon nanotubes are shown to contain an encapsulated multiphase aqueous fluid, thus offering an attractive test platform for unique in situ nanofluidic experiments in the vacuum of a transmission electron microscope. The excellent wettability of the graphitic inner tube walls by the aqueous liquid and the mobility of this liquid in the nanotube channels are observed. Complex interface dynamic behavior is induced by means of electron irradiation. Strong atomic-scale interactions between the entrapped liquid phase and the wetted terminated graphite layers are revealed by means of high-resolution electron microscopy. The documented phenomena in this study demonstrate the potential of implementing such tubes in future nanofluidic devices. (C) 2001 American Institute of Physics.