We experimentally and theoretically characterize dielectric nano- and microparticle orbital motion induced by an optical vortex of the Laguerre-Gaussian beam. The key to stable orbiting of dielectric nanoparticles is hydrodynamic inter-particle interaction and microscale confinement of slit-like fluidic channels. As the number of particles in the orbit increases, the hydrodynamic inter-particle interaction accelerates orbital motion to overcome the inherent thermal fluctuation. The microscale confinement in the beam propagation direction helps to increase the number of trapped particles by reducing their probability of escape from the optical trap. The diameter of the orbit increases as the azimuthal mode of the optical vortex increases, but the orbital speed is shown to be insensitive to the azimuthal mode, provided that the number density of the particles in the orbit is same. We use experiments, simulation, and theory to quantify and compare the contributions of thermal fluctuation such as diffusion coefficients, optical forces, and hydrodynamic inter-particle interaction, and show that the hydrodynamic effect is significant for circumferential motion. The optical vortex beam with hydrodynamic inter-particle interaction and microscale confinement will contribute to biosciences and nanotechnology by aiding in developing new methods of manipulating dielectric and nanoscale biological samples in optical trapping communities.