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Transmission fluid is colored green or red so it can be distinguished from other fluids in the vehicle. While it may not be especially dangerous to drive a vehicle that is leaking transmission fluid, it is not a good idea because the vehicle may not run properly.

Transmission fluid leaks can become increasingly common as your vehicle becomes older and wear and tear increases. Fluid leaks can result from many different causes, most commonly with faulty installation and broken seals. Here is a list of the most common problems that can cause a transmission fluid leak.

Transmission fluid lubricates each component of your transmission. In a vehicle with an automatic transmission, the fluid acts as a coolant, a power transmitter, and lubricant. Sometimes you can tell that your car is leaking transmission fluid because it will leave a trail and puddle of reddish fluid underneath the vehicle.

Your car may have a transmission fluid leak for a variety of reasons, but before we talk about why you have a transmission fluid leak, it’s important to talk about how to identify one. You’ll notice a bad transmission fluid leak when parked when you see some funny color or funny smelling oil on the garage floor when you move your car.

Avner says a minor leak can turn into a major problem if left alone. A low transmission fluid level or various component failures of the transmission can severely damage a transmission, leading to the need for a rebuilt or replacement transmission.

Transmission fluid leaks around the front and middle of the car [source: Ford]. If you find puddles of red, slick liquid on your driveway where the front and middle of your car sit, you most likely have a transmission fluid leak.

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