Why is My Car Leaking Oil?

Written by Tim Charlet and 1 other
Updated Jan 7, 2026

An oil leak is caused by three primary sources: loose drain plugs or fittings, cracked oil distribution lines or worn seals and gaskets.

Repair costs 2

Whether the oil leak is coming from your engine, transmission or other driveline components, diagnosing the root source of the leak can be easy for most vehicle owners. But after helping 40,000 customers with maintenance and repairs, Jerry has learned that repairing those leaks correctly is something you should leave to the experts. 

Want to be sure about the cause of your oil leak? Download the Jerry app and join the 40,000 number of people who have used our AI diagnosis chatbot to troubleshoot their car issues.

Real customers Jerry has helped

Costs for getting your car to stop leaking oil depend on your exact vehicle, where you live and the quality of parts used. With Jerry, you can quickly see what drivers are paying right now. Below are real examples of customers we’ve helped secure top prices for when they need a fix for their oil leak issue.

Last Updated Jan. 7, 2026

Estimates are modeled based on real vehicle and location data; names have been changed. Actual prices will vary by shop, parts, and vehicle condition.

Can I keep driving with an oil leak?

Oil leaks have multiple sources and different levels of seriousness. Running a quick diagnostic in the Jerry app can help you decide whether to take your car to a shop or not. Here’s a breakdown of the criteria to help you accelerate repairs if needed.

🚨 Urgent — stop driving and get this repaired ASAP

  • If you find a large puddle of oil bigger than a foot in diameter under your engine compartment or transmission after a short drive.
  • If you notice the oil pressure warning light is illuminated on the dashboard, or a Check Engine Light appears along with the oil leak puddle.
  • If the engine is making a constant ticking or knocking sound when it’s running.

🕒 Soon — OK to drive, but fix this week

  • If you discover small drips (less than two inches in diameter) under your engine bay or transmission after parking overnight.
  • If you must add engine or transmission oil once per month to keep it at optimal levels.
  • If you notice fresh oil stains in your usual parking spot.

Monitor — safe to drive

  • When you find a small oil stain randomly, but not every day.
  • If you notice the bottom of your engine or transmission has a lot of dirt stuck to it (near an oil pan or filter).
  • If you find dried oil residue in the engine bay but no fresh leaks.

Why this works: A combustion engine requires constant lubrication to maintain smooth operation. The transmission is a hydraulic system that is dependent on oil pressure to shift gears. If the oil pressure or level decreases, it causes excessive heat and friction of moving parts. This leads to premature wear and tear, overheating and eventually, complete engine or transmission failure.

While a tiny leak might be more of an inconvenience, locating its source and getting it repaired sooner rather than later will save you money in the long run.

Pro tips: It’s common to find a puddle of liquid under your car, especially during warmer seasons when you use air conditioning. This is normal, as it’s caused by condensation that has built up within the air conditioning system.

  • To check if it’s oil or water, put your finger in the puddle and smell the liquid. If it has no aroma or color, it’s water.
  • If you determine that the leak is oil, check the color. If it’s black or has a cloudy transparent tint, it’s likely engine oil. If it has a similar consistency as vegetable oil or transparent tint, it may be power steering fluid. If it’s red in color, that’s likely automatic transmission fluid (ATF). 

Symptoms (explained with typical fixes)

Small oil spots appear after parking overnight
What it likely means
A worn gasket is slowly permitting oil to escape from an engine cover or oil pan
Typical fix
Swap out the gasket, clean the area and replace the engine oil and filter
Price range
$150–$400+
A large puddle of oil immediately after driving
What it likely means
Damaged or loose oil line, drain plug, filter, or a major seal or gasket failure
Typical fix
Inspect and tighten the loose fitting or replace the gasket, filter or oil line
Price range
$50–$800+
Oil splattered in the engine bay or on components
What it likely means
A valve cover or timing cover gasket, oil fill cap or oil line is cracked, loose or broken
Typical fix
Replace any damaged parts, clean the engine bay and complete an oil and filter change
Price range
$200–$500+
Blue smoke is coming from the exhaust pipe and you notice oil levels are low
What it likely means
Internal engine problem, either in the cylinder head hardware (valves), piston rings or oil pump failure
Typical fix
Significant repair in most cases, requiring full engine rebuilding or replacement
Price range
$2,500–$8,000+
You find a reddish colored oil on the ground under the center of your vehicle
What it likely means
Likely transmission fluid coming from a worn-out seal or gasket
Typical fix
Replace all external seals and gaskets
Price range
$300–$600+

Download the Jerry app to compare local automotive repair quotes side-by-side in minutes.

Risks if you ignore it

Refusing to fix an oil leak can lead to costly repairs down the road. Some of the most common mechanical failures associated with lower oil levels or oil pressure (due to less oil in the engine) include the following:

Engine seizure: A combustion engine consists of multiple moving metallic parts. Engine oil helps to lubricate them, keeping them cool, so low oil levels can cause multiple parts to overheat. This leads to so much friction inside the engine that the metallic parts will seize or bond together. If this occurs, complete engine replacement is the only solution.

Fire hazard: When oil leaks from the engine, it can be exposed to extremely hot parts — like the exhaust system. This may result in fire ignition, creating a serious safety risk.

Environmental damage: Engine oil that leaks from your car stains driveways, city roads and highways. When it rains, this contaminates our water supply and poses environmental risks.

DIY vs. Pro: Can I fix this myself?

Some oil leaks are caused by minor mechanical issues, such as forgetting to tighten an oil cap after an oil change. However, data from Jerry customers shows most root sources should be diagnosed and repaired by a professional mechanic.

DIY-friendly fixes

If your car leaks oil from the top of the engine, this may be due to an oil cap that’s loose or not installed correctly. 

  • You can remove the oil cap carefully, then clean the cap and the base where it’s installed with a paper towel to remove any dirt or residue, ensuring a clean reinstallation.
  • Once it’s clean, reinstall the cap until it is fully hand-tight. There is no need for any tools.

Professional mechanic repairs

Most oil leak repairs are too complex for the average car owner. Not only that, but gaining access to the root leak source requires an elevated lift and often removal of additional components.

Here are some of the oil leak repairs that you should defer to a professional mechanic.

  • Valve cover gasket replacement: A damaged valve cover gasket will cause engine oil to seep through the valve cover and onto the engine block. This repair requires removing the valve covers, the damaged gaskets, cleaning up, reinstalling and properly torquing bolts to OEM specifications.
  • Oil pan gasket replacement: A damaged oil pan gasket causes oil to leak from the pan and directly onto the ground. This repair involves draining the engine oil, removing the oil pan, the damaged gasket, cleaning up, reinstalling and then properly torquing oil pan bolts to OEM specifications. It also involves replacing the oil filter and adding new engine oil.
  • Main seal replacement: The main crankshaft/camshaft seal can wear out and lead to engine oil leaking from the front or rear of the engine. This is a major mechanical repair that involves removing the fuel system and cylinder heads, then replacing the damaged main seals.  
  • Oil cooler line replacement: A frayed or damaged high-pressure oil cooler return line usually causes this leak. The repair involves the use of multiple specialty tools and diagnostic equipment to check for pressure leaks after replacement.
  • Transmission seal leaks: Oil leaks coming from the transmission are typically caused by a worn-out seal or gasket. All transmission repairs should be completed by an OEM-certified transmission repair shop or dealership.

Download the Jerry app to book a trusted shop and set maintenance reminders in one place.

Special notes

  • High-mileage vehicles: You’ll typically notice oil leaks after your vehicle reaches 100,000 miles.
  • After an oil change: If you see oil leaking before this milestone and you recently had your engine oil replaced, return to that shop to have them inspect the vehicle immediately.
  • Turbocharged engines: It’s very common for turbocharged engines to leak oil earlier and more frequently than standard fuel-injection engines. This is due to excessive heat, which wears out seals and gaskets earlier. Stay on top of your routine vehicle mileage inspections to avoid expensive oil leak repairs.

What not to do

  • NEVER purchase or use oil stop-leak additives or products. These products may temporarily slow your oil leak but cause more permanent damage to internal engine components.
  • DO NOT ignore Oil Pressure or Check Engine warning lights. If you have a dedicated Oil Pressure Light on your vehicle and it illuminates, find a safe place to stop and contact a professional mechanic as soon as possible.
  • DO NOT let engine oil levels fall below the fill line on the oil dipstick. If you have an oil leak, make sure to check the engine oil level once per week and add oil as needed to keep it above the bottom of the fill line.

Prevention

Thanks to advancements in synthetic oils and gasket/seal materials, oil leaks are not as common in modern vehicles (post-2010). However, there are three crucial routine maintenance items you can complete to help reduce the root causes of many oil leaks:

Check oil level monthly and look for fresh spots under your parked car. Early detection prevents major problems.

Change oil and filter as recommended by your manufacturer using quality products. Fresh engine oil helps lubricate seals and gaskets. You can track your repair intervals in the Jerry app to make sure your oil and filter maintenance is done consistently.

Have your transmission fluid flushed as recommended by your manufacturer. This is often overlooked as the main reason why transmission seals and gaskets fail.

What our customers are asking us

  • Why does my leak seem worse when parked?
  • How much oil loss is normal?
  • Is it safe to drive with a small oil leak?
  • Why does my engine bay look oily, but I don’t see drips?
Expert-driven. Built for you.
Our experts
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Tim Charlet

A published columnist, automotive journalist, former service writer and ASE Automobile & Light Truck Certified technician (A1 – A9 – 1996 – 2006), Tim Charlet brings nearly four decades of automotive communication experience to the team at Jerry.

Charlet has written more than 10,000 articles, blogs and technical manuals for the automotive industry. His experience working with OEM & aftermarket manufacturers, enterprise-level dealerships and private service technicians provides him with a unique perspective on how modern cars, trucks and SUVs operate and are serviced.

Additionally, his years of digital marketing content & public relations experience provide a conversational, yet easy-to-follow writing style for both professionals and general consumers.

Along with writing for Jerry, Charlet also works with multiple automotive detailing product manufacturers, creating user-friendly and eco-friendly detailing and vehicle protection liquids. 

He is also the co-founder of Right2Breathe.org, a non-profit organization dedicated to raising awareness for COPD, Asthma and other respiratory diseases within the automotive industries.

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Everett Cook

Everett Cook is an award-winning journalist and editor with more than 10 years of experience across a variety of industries. In editing for Jerry, Everett’s mission is to help readers have a better understanding of the costs of owning or leasing a car and to better understand their vehicle in terms of insurance and repairs. Prior to joining Jerry, Everett was an editor for Axios. His previous work has been featured in The New York Times, The Los Angeles Times, The San Francisco Chronicle, The Atlantic, Atlantic Re:think, The Boston Globe, USA Today, and others. He’s also been a freelance writer and editor with experience in SEO, audience building, and long-term content roadmaps. Everett is a proud graduate of the University of Michigan.

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