As a new type of oil–water separation equipment, cylindrical hydrocyclone has the advantages of small volume, compact structure and high efficiency. Oil droplets will coalesce in it, so it can be used as a coalescer. In this paper, the coalescence mechanism of oil droplets in the cylindrical hydrocyclone is studied by means of experiment and theoretical analysis. By studying the two major factors that affect the coalescence phenomenon, namely, collision frequency and coalescence efficiency, it is found that the turbulent pulsation in the cylindrical hydrocyclone is the main cause of the droplet collision. On the premise that the two-phase mixture has the same properties, the two factors that affect the droplet coalescence are the particle size of the colliding droplet and the turbulent dissipation rate. The turbulent dissipation rate near the center of the hydrocyclone is relatively small, so the concentration of oil droplets here is not only large (the spacing of oil droplets becomes smaller), but also the coalescence frequency is high. The turbulent dissipation at the hydrocyclone tube wall is strong, and the collision frequency of oil droplets is low, so it is difficult to coalesce here. In other words, the larger the turbulent dissipation rate, the more unfavorable the coalescence of oil droplets. The research results of this paper lay a foundation for improving the coalescence effect of oil droplets in the cylindrical hydrocyclone. © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.