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Pare and cook potatoes til tender 30-35 minutes Drain and set aside.
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In a large skillet, fry bacon til crisp. remove and drain.
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Cook and stir chopped onion in bacon drippings til tender and golden.
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Stir in flour, sugar, salt, celery seed and pepper.
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Cook on low heat, stirring til bubbly.
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Remove from heat.
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Add water and vinegar.
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Heat to boiling, stirring constantly.
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Boil and stir for one minute.
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Remove from heat.
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Crumble bacon and slice potatoes.
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Carefuly stir bacon and potatoes into hot mixture in skillet.
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Heat thoroughly, stirring lightly to coat potato slices.