Two-phase flow modelling is strongly dependent on flow patterns. For the purpose of objective flow pattern identification, a capacitance sensor was developed for horizontal two-phase flow in small diameter tubes. Finite element simulations were made during design to study the effect of vapour distribution, wall thickness and electrode angle. A test rig was constructed and a series of experiments was done with horizontal air–water flow in a 9 mm tube. The sensor test results are presented in time, amplitude and frequency domain. Flow regime characterization with the capacitance measurements is clearly possible.