The atmosphere has sufficient water for resolving potable water scarcity on earth if vapor present in moist condenses effectively and efficiently. In this work, a device known as an atmospheric water generator (AWG) is designed and fabricated to produce water from the atmospheric air. In this device, the condensing surface is hydrophobic, and it was cooled below the dew point by the R-22 refrigerant-based vapor compression unit. The experiment of moist air condensation was conducted under real environmental conditions in Noida, India, from July to September 2023, with condensate being collected at regular intervals. Temperature at various locations and power consumption were measured at regular time intervals for energy and exergy analysis. The feasibility and economic viability of the system were carried out. The proposed device collected 3.6 L of water per hour at a temperature of 32 °C and relative humidity of 70%. However, the cost of water is 4 INR per liter at minimum destruction of exergy. This research contributes to a deeper understanding of vapor compression-based atmospheric water generator system thermodynamics, offering insights crucial for optimization and further development of this technology as a sustainable water generation solution.