A neutron gauge for the accurate determination of high mean void fractions in a water-steam mixture has been designed to operate on the transmission of a thermal-neutron beam obtained with a 252Cf neutron source coupled with a polyethylene howitzer. Calibrations, carried out with a Plexiglas-air combination simulating annular flow and core flow, show that the gauge is characterized by high sensitivity and precision with respect to the other radiation techniques. Taking into account the lack of calibration standards and the wide range of water and steam densities generally involved in heat transfer processes, we developed a mathematical model of the gauge response to obtain adequate performances for practical use. The model, which is valid in principle for any flow regime, is specialized here for annular flow, which is of interest for the foreseen application in heat transfer studies on an out-of-pile test facility.