The formation mechanism of copper nanoparticles (NPS) using poly(N-vinyl-2-pyrrolidone) (PVP) as a capping agent was investigated by measurements of X-ray diffraction (XRD), transmission electron microscopy (TEM), in situ time-resolved X-ray adsorption fine structure (XAFS) analysis, in situ UV-vis spectroscopy, and all indicator method. XAFS analyses, in combination with TEM observations and the indicator method, revealed that the stable intermediates such as Cu(OH)(2) and Cu+-PVP intermediate were formed during an induction period of nucleation of Cu NPs, which play a critical role in the Cu NP formation. Our results suggest that the PVP capping agent is important not only to protect NPs from overgrowth and aggregation but also to control the reaction kinetics of NP formation.