In a condensation reaction, two reactants react to form water or ammonia and one other byproduct. As long as either water or ammonia is formed and is the only byproduct, a reaction is considered a condensation reaction. A condensation reaction is not to be confused with the process called condensation, where water vapor turns to liquid after losing heat.
The two reactants will combine to form a longer and more complex molecule in a condensation reaction. When water is the other byproduct, one reactant molecule typically loses a single hydrogen atom, while the other loses both a hydrogen and an oxygen atom. A similar process happens in other condensation reactions, but with an extra hydrogen atom lost and a nitrogen atom in place of oxygen.