We study the photon-photon correlation properties of two-photon transport in a one-dimensional waveguide coupled to a nonlinear cavity via a real-space approach. It is shown that the intrinsic dissipation of the nonlinear cavity has an important effect upon the correlation of the transported photons. More importantly, strongly correlated photons can be obtained in the transmitted photons even when the nonlinear interaction strength is weak in the cavity. The strong photon-photon correlation is induced by the Fano resonance involving destructive interference between the plane wave and bound state for two-photon transport.