In this paper the physical model for high pressure water atomization of metal melts using hydraulic nozzle of a vortex type was proposed. The developed model assumes, that due to high speed water flow with significant centrifugal component of its velocity vector the rarefaction is formed, which causes intensive air suction leading to the formation of rotating gas (vapor-air) layer of toroid-like shape, providing a gap between the water flow and the metal stream. Thus water stream is separated from the heated surface of metal stream and the formation of particles during crystallization of melt droplets occurs due to surface tension mainly in this vapor-air layer. The cooling of melt droplets in the gas-water leads to the formation of spherical powder particles. The proposed model correlates well with the known experimental data on the production of spherical powders using a vortex-type annular hydraulic nozzle.