The flow and thermohydraulic characteristics of an atmospheric‐pressure argon arc jet plume injected into water were investigated. The temperature of the underwater plasma plume was measured using optical emission spectroscopy, and the water with a thermocouple. The velocity field of the water induced by the arc‐jet injection was observed using the particle image velocimetry method, which demonstrated that as the discharge current increased, the water flow velocity also increased. The diameter of the plasma plume was observed to be approximately the same as that of the anode nozzle, 6.7 mm. The heat transfer characteristics of the injected arc jet plume to the surrounding water were also investigated. The average velocity of the arc jet plume in the water was estimated based on mass balance to be in the range of 280–2500 m/s as a monotonically decreasing function of the flow distance. The velocity of the underwater arc is found to be subsonic over the entire volume of the plasma plume, however, it is larger than the sound velocity of the water up to 10 mm downward from the plasma nozzle. The resultant Reynolds number of the plasma flow was found to be between 1000 and 2800, indicating the flow was turbulent only at the most upstream region up to 3 mm downward from the nozzle, while it was almost laminar over the whole observed area of the underwater arc plasma plume. The heat transfer characteristics were discussed in terms of the dimensionless numbers. The Nusselt number ranges from approximately ∼3.8 to ∼6.5, which is a reasonable value. Although the existing theories of correlation heat transfer cannot fully explain the relationship between these dimensionless numbers, the correlation proposed by Fiszdon and the one by Lee–Pfender can qualitatively explain the observed results for the upstream region, which include the effects of the variation in the mass density, the viscosity, and the specific heat for a constant pressure of the argon arc plasma. © 2022 Institute of Electrical Engineers of Japan. Published by Wiley Periodicals LLC.