We perform an ab initio study of the motion of the nano sized water dimer through a single-walled carbon nanotube (SWCNT), the stability of an encapsulated one-dimensional (1D) water chain inside SWCNT, and the H2 O -induced structural, energetic, electronic, and optical properties of the SWCNTs. The adsorption of the water molecules is caused by the dispersion forces, i.e., the van der Waals (vdW) interactions. Thus, the role of the vdW interactions in the estimation of the BE for the weakly bound adsorbates cannot be ignored as has been done in several earlier publications. We find that a single H2 O molecule or single water dimer or a 1D chain of water dimers is trapped inside the medium-sized (6,6) carbon nanotube placed in vacuum. However, the H2 O molecule or water dimer may be transmitted in case the tube is surrounded by water or water vapor at high vapor pressure at high temperatures. On the other hand, a chain of single H2 O molecules or more number of the encapsulated H2 O molecules is very weakly coupled to the wide (10,10) carbon nanotube and can, thus, easily transmit through the carbon nanotube in agreement with the recent experiments. Further, appreciable adsorption both inside and on the surface of the (10,10) carbon nanotube is predicted in concurrence with the experiments. The small (medium-sized) diameter tubes will adsorb strongly (accommodate) the water molecules outside (inside) the nanotubes. The H2 O adsorption converts the conducting small-diameter zigzag (5,0) tube into a semiconductor. Further, the adsorption reduces the band gap of the semiconducting achiral zigzag (10,0) nanotube but increases the band gap of a chiral semiconducting (4,2) tube. The adsorbed H2 O molecules increase the electrical conductivity in agreement with the experiment. The overall peak structure in the optical absorption for the pristine tube is not altered significantly by the adsorption except for small alterations in the energy locations and the relative intensities of the peaks in the achiral tubes. © 2007 The American Physical Society.