How Can I Tell If Water Is in My Motor Oil?by Nathan Fisher
Not all indications of water in the oil mean a repair is warranted. As the engine heats up after it is started, and then cools off after the car is turned off, condensation can cause small amounts of water to enter the oil. This is generally harmless, and will be burned off through normal driving. Large amounts of coolant (antifreeze and water) can contaminate the oil if a gasket ruptures, or the engine's head or block becomes damaged. Major contamination will reduce the oil's effectiveness in lubricating the engines moving parts. If this is the cause, it should be repaired as son as possible.
Remove the engine oil dipstick. Bubbles on the stick, a brownish residue just above the oil level, or milky-brown oil with a thick consistency are all indications of water in the oil.
Check for white, sweet smelling smoke coming from the tailpipe. This is an indication of coolant in the oil being burned off.
Turn the engine off and let the vehicle sit for a few hours. Remove the drain plug from the oil pan with a wrench, draining a small amount of oil into a drain pan. As oil is lighter than water, any water will collect at the bottom of the pan, with the oil floating on top.