The flow field in the tip region of the axial-flow waterjet pump is very complex. Although it has been studied for many years, many relevant phenomena have still been a puzzle. In present paper, many detailed data on instantaneous inner structures of the tip leakage flow and evolution of the tip leakage vortex cavitation with different tip gap sizes are offered. The numerical simulation has been conducted by using SAS turbulence model and ZGB cavitation model to understand the cavitation-vortex interaction mechanism. The predicted cavitation performance exhibits a reasonable agreement with the experimental results. Based on the illustration, with the impeller tip gap size decreasing, the cavitation area in rotating region gradually decreases. The cavitation development enhances vorticity production in an axial-flow waterjet pump. Vortices are mainly located at the impeller tip leakage region. The analysis of the relative vorticity transport equation indicates that the baroclinic torque term and the vortex dilation term have significant effects on cavitation, the main contributor to vortex generation is the vortex dilation term. In addition, in the impeller tip region, the effect of viscous diffusion term cannot be ignored, and the cavitation area has a larger amplitude of pressure pulsation.