Abstract: This invention is a method for pre-expanding a heat exchanger tube prior to its insertion into a tube sheet. A tubular mandrel having an elastic bladder sheath sealed at each end is inserted into the tube and positioned at the point where the tube is to be expanded. A die with an annular recess approximating the shape to which the tube is to be expanded is clamped around the outer surface of the tube, concentric to the mandrel. The elastic bladder is then pressurized with hydraulic fluid pumped through a passage in the mandrel, thereby deforming the tube outward so that it conforms to the recess in the die. A heat transfer enhancement treatment thereafter may be applied to the exterior of the tube between the expanded sections, without concern that it may crack off when the tube is installed in a tube sheet. In addition, the hydraulic pre-expansion process prevents or minimizes cracking of the tube which sometimes occurs when a tube is expanded to an equivalent diameter in a single operation.