We have demonstrated for the first time a remarkable reduction of current collapse in AlGaN/GaN highelectron-mobility transistors (HEMTs) by high-pressure water vapor annealing (HPWVA). The device subjected to HPWVA exhibited considerably low dynamic ON-resistance (R ON ), suggesting highly improved performance of these devices. Analyses of the results on normalized dynamic R ON experiments have shown the elimination of deeper traps by HPWVA, leading to the substantially reduced current collapse. X-ray photoelectron spectroscopy (XPS) studies revealed a significant increase in the oxygen core-level O 1s peak. Moreover, angleresolved XPS suggested the formation of surface oxide layer. These results indicate that the effective reduction of current collapse in the HPWVA-processed samples is likely due to the incorporation of active oxygen species generated by the HPWV into the AlGaN surface. These oxygen atoms eventually fill up near-surface nitrogen vacancies and promote the formation of Ga 2 O 3 native oxide and possibly Ga 2 O suboxide, which is known to be an excellent III-V surface passivant. HPWVA is a relatively simple, low-damage, and low-temperature process, and hence, it is found to be a highly feasible and promising alternative for realizing AlGaN/GaN HEMTs with improved performance.Index Terms-AlGaN/GaN high-electron-mobility transistor (HEMT), current collapse, high-pressure water vapor annealing (HPWVA), normalized dynamic R ON (NDR), ON-resistance, X-ray photoelectron spectroscopy (XPS).