In Murata vortex spinning (MVS), the principle of yarn formation is closely related to the flow field inside the nozzle. This paper presents a numerical simulation of the flow characteristics inside the nozzle of the MVS machine. A three-dimensional grid and the realizable k-ε turbulence model are used in this simulation. The numerical results of pressure distribution and velocity vectors inside the nozzle are shown. A streamline starting from the nozzle inlet is also acquired. Based on the simulation, the principle of yarn formation of MVS is discussed. It is shown that a negative pressure zone exists in the center of the twisting chamber. The collision between the air currents entering the twisting chamber through the nozzle inlet and the yarn passage of the hollow spindle occurs in the vicinity of the spindle inlet, resulting in a reverse flow and a vortex. The disturbance of the flow helps to separate fibers. In addition, the simulation results have well supported the principle of yarn formation of MVS claimed by the spinner makers.