Submicron droplets of liquid perfluorocarbon converted into microbubbles with applied ultrasound have been studied, for a number of years, as potential next generation extravascular ultrasound contrast agents. In this work, we conduct an initial ultra-high-speed optical imaging study to examine the vaporization of submicron droplets and observe the newly created microbubbles in the first microseconds after vaporization. It was estimated that single pulses of ultrasound at 10 MHz with pressures within the diagnostic range are able to vaporize on the order of at least 10% of the exposed droplets. However, only part of the newly created microbubbles survives immediately following vaporization – the bubbles may recondense back into the liquid droplet state within microseconds of nucleation. The probability of bubble survival within the first microseconds of vaporization was shown to depend on ultrasound excitation pressure as well as on bubble coalescence during vaporization, a behavior influenced by the presence of coating material on the newly created bubbles. The results of this study show for the first time that although initial vaporization of droplets is necessary to create echogenic bubbles, additional factors, such as coalescence and bubble shell properties, are important and should be carefully considered for the production of microbubbles for use in medical imaging.