Place the potatoes into a pot, and fill with enough water to cover. Bring to a boil, and cook for about 10 minutes, or until easily pierced with a fork. Drain and set aside to cool.
Place the bacon in a large deep skillet over medium-high heat. Fry until browned and crisp, turning as needed. Remove from the pan and set aside. Crumble once cool.
Add onion to the bacon drippings and cook over medium heat until browned. Add the vinegar, water, sugar, salt and pepper to the pan. Bring to a boil then add the potatoes and parsley. Stir in half of the bacon crumbles. Heat through, then transfer to a serving dish. Top with the remaining bacon crumbles.
While this salad is traditionally served warm, it need not be.