The water cooled tuyere noses, through which hot blast is blown into the furnace, are exposed to very high temperature region of raceway inside the furnace. As a result the chances of rupture of cooling pipes within the tuyere nose are significantly high. The rupture causes water dripping into the furnace and if it continues and unnoticed for a prolonged period it lowers down the local raceway temperature and thus adversely affects the product hot metal and slag quality. Moreover, with heavy water leakage, there is a danger of explosion; monitoring of the cooling water is therefore essential. Despite the availability of water flow metre at each tuyere it is difficult to identify the leaking tuyere at the early stage unless the rupture size grows bigger and so the leakage. In several cases the furnace is forced to shut down to manually inspect the leakage occurring without prior knowledge of the exact tuyere number. Identification of water leakage at an early stage is therefore necessary to prevent process disturbances due to chilling of the furnace and avoid the unscheduled downtime for tuyere replacement. This paper presents a method to identify the water leakage from tuyere nose cooling circuit in blast furnace and the adverse effect of water leakage on the performance of the blast furnace. A system called water leak detection system is developed for different blast furnaces in Tata Steel Jamshedpur to monitor the water leakage through tuyere nose and identify the exact leaking tuyere based on a dimensionless number called leak detection factor.