The aim of this study was to clarify the initiation process and the propagation mechanism of positive underwater streamers under the application of pulsed voltage with a duration of 10 μs, focusing on two different theories of electrical discharges in liquids: the bubble theory and the direct ionization theory. The initiation process, which is the time lag from the beginning of voltage application to streamer inception, was found to be related to the bubble theory. In this process, Joule heating resulted in the formation of a bubble cluster at the tip of a needle electrode. Streamer inception was observed from the tip of a protrusion on the surface of this bubble cluster, which acted as a virtual sharp electrode to enhance the local electric field to a level greater than 10 MV/cm. Streak imaging of secondary streamer propagation showed that luminescence preceded gas channel generation, suggesting a mechanism of direct ionization in water. Streak imaging of primary streamer propagation revealed intermittent propagation, synchronized with repetitive pulsed currents. Shadowgraph imaging of streamers synchronized with the light emission signal indicated the possibility of direct ionization in water for primary streamer propagation as well as for secondary streamer propagation.