Hey just picked up this 1999 XJ Limited and I noticed a lot of oil build up and leakage. Most of it is under neath the axle and some even got onto the back of the drum. Is this a serious issue and what could be causing it to leak like this? All help will be appreciated thanks!

 

I've seen this before on the 8.25. The axle shafts are just pressed in and plug welded I believe. That means it is possible for oil to seep out around the tube. I would just check the fluid levels and run it.

 

That is kinda wierd. Have to look at mine. See what it looks like. First thing that pops into my head is the rear diff breather. Is there a chance that if it is pluged and not breathing properly fluid would be forced out somewhere else?

 

Looks like an excessive leak, I would be concerned with the integrity of the connection at axle tube and pumpkin. If that gear oil contaminates the brake pads, they will not function and must be replaced.