We numerically study the dynamics of a hollow water droplet falling in the air under the action of gravity. The focus of our study is to investigate the effects of the difference in radii (thickness) of the hollow droplet, gravity and surface tension at the air–water interface on shape oscillations and the breakup dynamics of the hollow droplet. We found that the oscillations of the inner interface (inner air bubble) are mostly periodic, while the outer interface undergoes irregular oscillations due to the interaction with the surrounding air. Increasing the ‘thickness’ of the hollow droplet decreases the amplitude of oscillations which further decays with time for high surface tension. It is observed that for a fixed value of the ‘thickness’ and low surface tension, the hollow droplet undergoes transition from the oscillatory regime to the dripping regime as it falls. The velocity contours are used to explain the behaviour observed in the present study. The deformation and shape oscillations of the hollow droplet are also compared with those observed in the case of a normal droplet of equal liquid volume falling in air. © 2020, Springer-Verlag GmbH Germany, part of Springer Nature.