Tip-clearance cavitation is one of the most aggressive forms of cavitation as it can cause surface erosion of hydraulic machinery elements and, as a result, their fatigue damage and disturb designed operating conditions. At present, the literature lacks for detailed experimental data on the inception and development of this type of cavitation at various flow conditions. In the paper, a tip-leakage cavitation occurring in the clearance between an end face of a 2D hydrofoil (a scaled-down model of guide vanes (GV) of a Francis turbine) and a transparent wall of the test section was studied. The experiments were carried out for different cavitating regimes on the cavitation number and two attack angles of 3° and 9°, with the gap size (tip clearance width) varied in the range from 0.4 to 0.8 mm. In order to determine the cavitation inception conditions and investigate the dynamics of the tip-leakage cavitation, a high-speed visualization was applied. A modified PIV/PTV technique with a diverging laser beam instead of a laser light sheet was used to measure the mean velocity distributions within the gap. It was shown that the cavitation pattern on the suction side of the GV model impacts the dynamics of the leakage flow in the gap but does not affect the sheet cavity formed close to the foil leading edge in the clearance as well as its size and dynamics. When the gap size is increased, the tip-leakage cavitation initiates at higher cavitation numbers or, in other words, conditions for the cavitation occurrence become more favorable.