A study of energy relaxation processes of H 2 O-doped rare gas clusters excited with vacuum ultraviolet synchrotron radiation is presented. An enhanced quenching of electronically excited fragment OH*(A) is observed in Ar m Ne N clusters (mϽ10 2 , NϷ7.5ϫ10 3 ). The doping of interior of small argon clusters has been achieved by using a ''sequential pick-up'' technique (Ne N ϩH 2 O ϩmAr). Due to a low temperature of the Ne host cluster the Ar atoms are fixed around the H 2 O molecule prohibiting structural rearrangements. A strong decrease of the OH*(A) fluorescence yield has been observed for mϾm 1 ϭ12. This effect is attributed to a formation of the second (m 2 ϭ54) and higher shells of Ar atoms around the water molecule. The principal contribution from a noncomplete second shell (m 2 *ϭ32) after a closure of 20 triangular windows in the first shell is suggested. Due to a finite size of the cluster matrix and fast sample renewal, the cage exit and reentry processes can be investigated.