An experimental study on the performance of a domestic water-cooled air-conditioner (WAC) using tube-in-tube helical heat exchanger for preheating of domestic hot water was carried out. The main aims are to identify the comprehensive energy performance (space cooling and hot water preheating) of the WAC and the optimum design of the helical heat exchanger taking into account the variation in tap water flow rate. A split-type WAC was set up for experimental study at different indoor and outdoor conditions. The cooling output, the amount of recovered heat, and the power consumption for different hot water flow rates were measured. The experimental results showed that the cooling coefficient of performance (COP) of the WAC improves with the inclusion of the heat recovery option by a minimum of 12.3%. This can be further improved to 20.6% by an increase in tap water flow rate. Same result was observed for the comprehensive COP of the WAC. The maximum achievable comprehensive COP was 4.92 when the tap water flow rate was set at 7.7 L/min. The overall heat transfer coefficient of the helical heat exchanger under various operating conditions were determined by Wilson plot. A mathematical model relating the over all heat transfer coefficient to the outer pipe diameter was established which provides a convenient way of optimising the design of the helical heat exchanger. (C) 2008 Elsevier Ltd. All rights reserved.