In colder environment, atmospheric moisture as well as water produced by gasoline engine combustion condense in the engine oil and introduce a significant amount of water. This water affects the engine oil performance. Hollow fiber membrane-based artificial kidney successfully removes waste metabolites from human blood. This configuration has been studied here for the removal of emulsified water in engine oil. The oil containing emulsified water flows on one side of the hollow fiber membrane; air flowing on the other side strips the moisture from the oil through a hydrophilic membrane present in the hollow fiber membrane wall. One of the four types of membranes studied was found to be most suitable over the temperature range studied, -10°C to 80°C. All studies were conducted with SAE 5W30 motor oil containing emulsified water at the level of 1 - 4 %. Batch recirculation studies demonstrated 90%+ removal of emulsified water in parallel flow modules containing 300 hollow fibers having a surface area of 150 cm2. Studies were successfully carried out over a range of temperatures, oil flow rates, water content and oil temperature ramping with the oil flowing through the bore of hollow fiber membranes and air flowing outside. The water-removal capabilities of such modules decreased slowly on repeated dewatering tests over 7-8 days due to membrane fouling by the emulsion; membrane fouling was also prevalent at the hollow fiber tube sheet. A cross flow hollow fiber device built with the engine oil flowing outside the fibers in cross flow demonstrated no such membrane fouling on repeated use. A mathematical model was developed to extract water mass transfer coefficient from the experimental data. The water mass transfer resistance in the oil film was found to be important. The cross flow device decreased this resistance substantially suggesting that a small membrane module should be able to remove moisture effectively in an automobile.