© 2017 Taylor & Francis Group, London. The increase in fuel demand for transportation and energy, and heat generation, together with the depletion of fossil fuel resources, has caused governments and manufacturers worldwide to turn to alternative biofuels. One such biofuel is the biodiesel, which can be used in both pure form or as a part of a blend with normal petroleum diesel. The biodiesel possesses a number of advantages, but is also very prone to water contamination. Free water in the fuel can, at the least, cause deterioration in performance characteristics of the engine that uses it, or in a worse case scenario corrosion of individual components, such as fuel manifolds and injectors. Microscopic droplets of diameter around 5 µm are especially hard to separate once they form emulsion in the fuel (Schweitzer (1997)). This industrially sponsored work will benefit the improved performance of engines using biodiesel, by estimating and minimizing the probability of failure of the fuel filter.