Structure, stability, and hydrogen-bonding interaction in phenol, water, and phenol-water clusters have been investigated using ab initio and density functional theoretical (DFT) methods and using various topological features of electron density. Calculated interaction energies at MP2/6-31G* level for clusters with similar hydrogen-bonding pattern reveal that intermolecular interaction in phenol clusters is slightly stronger than in water clusters. However, fusion of phenol and water clusters leads to stability that is akin to that of H2O clusters. The presence of hydrogen bond critical points (HBCP) and the values of p(r(c)) and del(2)p(r(c)) at the HBCPs provide an insight into the nature of closed shell interaction in hydrogen-bonded clusters. It is shown that the calculated values of total p(r(c)) and del(2)p(r(c)) of all the clusters vary linearly with the interaction energy.