This paper provides new physical insight into the coupling between flow dynamics and cavitation bubble cloud behaviour at conditions relevant to both cavitation inception and the more complex phenomenon of flow “choking” using a multiphase compressible framework. Understanding the cavitation bubble cloud process and the parameters that determine its break-off frequency is important for control of phenomena such as structure vibration and erosion. Initially, the role of the pressure waves in the flow development is investigated. We highlight the differences between “physical” and “artificial” numerical waves by comparing cases with different boundary and differencing schemes. We analyse in detail the prediction of the coupling of flow and cavitation dynamics in a micro-channel 20 μm high containing Diesel at pressure differences 7 MPa and 8.5 MPa, corresponding to cavitation inception and "choking" conditions respectively. The results have a very good agreement with experimental data and demonstrate that pressure wave dynamics, rather than the “re-entrant jet dynamics” suggested by previous studies, determine the characteristics of the bubble cloud dynamics under “choking” conditions.