We report a facile strategy to synthesize water-soluble, fluorescent gold nanoclusters (AuNCs) in one step by using a mild reductant, tetrakis(hydroxymethyl)phosphonium chloride (THPC). A zwitterionic functional ligand, D-penicillamine (DPA), as a capping agent endowed the AuNCs with excellent stability in aqueous solvent over the physiologically relevant pH range. The DPA-capped AuNCs displayed excitation and emission bands at 400 and 610 nm, respectively; the fluorescence quantum yield was 1.3%. The effect of borohydride reduction on the optical spectra and X-ray photoelectron spectroscopy (XPS) results indicated that the AuNC luminescence is closely related to the presence of Au(I) on their surfaces. In a first optical imaging application, we studied internalization of the AuNCs by live HeLa cells using confocal microscopy with two-photon excitation. A cell viability assay revealed good biocompatibility of these AuNCs. Our studies demonstrate a great potential of DPA-stabilized AuNCs as fluorescent nanoprobes in bioimaging and related applications.