Two-phase flow and transport of reactants and products in the cathode of a transparent proton exchange membrane fuel cell (PEMFC) are studied experimentally. Images of water formed inside the cathode gas channels are presented to explain the phenomenon of water flooding. Effects of air stoichiometry, temperature, air humidity and different characteristics of diffusion layers are discussed. The influence of hydrophobic and hydrophilic diffusion layers compared to standard carbon papers on water transport is investigated. Mathematical verification of a threshold current density corresponding to first appearance of liquid water at the membrane/cathode interface confirms the experimental results.