Atomistic simulations and a dislocation-based analysis reveal the mechanism of carbon peapod fusion into double-walled nanotubes. They explain the trend of diameter increase for the emerging inner wall, driven by the reduction in its strain energy and the interwall van der Waals energy. Surprisingly, this is also accompanied by the systematic bias in the nanotube chirality, changing from zigzag toward armchair. This prediction agrees well with our experimental data and is further supported by the analysis of earlier observations. [5][6][7][8][9] where the encapsulated fullerenes coalescence into an inner tube at high temperature. The peapod route is the preferred method for preparing relatively pure DWNTs with welldefined structures. 1 There has been considerable effort to understand the mechanism of fullerene coalescence and the transformations of sp 2 carbon networks. 8,[10][11][12][13][14] It is well established that that rotation of a C-C bond in a sp 2 carbon network, known as the Stone-Wales ͑SW͒ transformation, is the key step of such a transformation. 10,12,13 The calculated barrier of such a bond rotation is as high as 5-9 eV ͑Refs. 11 and 15͒ which explains the requirement of high temperature for the formation of peapod-derived DWNTs. 9 Because of the high barrier, it is impossible to simulate a defect-free DWNT structure by conventional molecular-dynamics simulation due to the limited simulation time ͑time scale from picosecond to nanosecond͒. 8,14 Although a full route from two fullerenes to a short SWNT has been demonstrated in previous studies, the final SWNT formation was predetermined and thus information about the inner-tube chiral angle cannot be determined correctly by these methods. [10][11][12][13] In this Rapid Communication, we study the formation of peapod-derived DWNTs. An atomic simulation successfully reproduces the transformation from peapods into a defectfree DWNT through the SW mechanism. It is found that most of the simulated inner tubes have large chiral angles ͑e.g., Ͼ 20°͒ and detailed theoretical analysis has shown that the preference for large chiral angles is dominated by the driving force of the SW transformation during tube fattening. Through careful analyzing experimental data, we have confirmed that the abundance of large chiral-angle tubes is in agreement with most experimental observations.It is well established that the kinetic Monte Carlo ͑KMC͒ method can simulate a long-time process by neglecting the thermal vibrations of atoms and considering the process of overcoming barriers directly. In mimicking the KMC method, we propose a similar method to study the coalescence of fullerenes but by considering instead the energy change in the barrier between two states. In detail, the sp 2 carbon network is described by the most used second generation Tersoff-Brenner potential in which the van der Waals interactions have been properly incorporated 15 and the energy of the relaxed initial structure is denoted as E i . A C-C bond is then selected randomly and rotated by 90°. Th...