The homogeneous condensation of water vapor at ambient temperature is studied using molecular dynamics simulation. We reveal that there is a droplet size at the nanoscale where water droplets can be stabilized in the condensation process. Our simulations show that the growth of water droplets is dominated by collision and coagulation between small water droplets after nucleation. This process is found to be accompanied by exceptionally fast evaporation such that droplet growth is balanced by evaporation when water droplets grow to a critical size, approximately 12.5 Å in radius, reaching a stable size distribution. The extremely high evaporation rate is attributed to the curvature dependence of surface tension. Surface tension shows a significant decrease with decreasing droplet size below 20 Å, which causes the total free energy of nanoscaled water droplets to rise after collision and coagulation. Consequently, water droplets have to shrink via fast evaporation. The curvature dependence of surface tension is related to the dielectric ordering of water molecules near the surface of water droplets. Owing to fast evaporation, secondary condensation occurs, and many small water clusters form, ultimately exhibiting a bimodal distribution of water-droplet size.