A high-resolution numerical simulation of an air–water turbulent upward bubbly flow in a pipe is performed to investigate the turbulence characteristics and bubble interaction with the wall. We consider three bubble equivalent diameters and three total bubble volume fractions. The bulk and bubble Reynolds numbers are $Re_{bulk}= u_{bulk} D/\nu _w = 5300$ and $Re_{bub}= (\langle u_{bub}\rangle - u_{bulk}) d_{eq}/\nu _w = 533\unicode{x2013}1000$ , respectively, where $u_{bulk}$ is the water bulk velocity, $\langle u_{bub}\rangle$ is the overall bubble mean velocity, $D$ is the pipe diameter and $\nu _w$ is the water kinematic viscosity. The mean water velocity near the wall significantly increases due to bubble interaction with the wall, and the root-mean-square water velocity fluctuations are proportional to $\bar {\psi }(r)^{0.4}$ , where $\bar {\psi } (r)$ is the mean bubble volume fraction. For the cases considered, the bubble-induced turbulence suppresses the shear-induced turbulence and becomes the dominant flow characteristic at all radial locations including near the wall. Rising bubbles near the wall mostly bounce against the wall rather than slide along the wall or hang around the wall without collision. Low-speed streaks observed in the near-wall region in the absence of bubbles nearly disappear due to the bouncing bubbles. These bouncing bubbles generate counter-rotating vortices in their wake, and increase the skin friction by sweeping high-speed water towards the wall. We also suggest an algebraic Reynolds-averaged Navier–Stokes model considering the interaction between shear-induced and bubble-induced turbulence. This model provides accurate predictions for a wide range of liquid bulk Reynolds numbers.