Time to smog the car so I'm changing out the mid pipes today and noticed a horrible leak at the rear. As you can see in the first picture there is what seems to be differential oil on the mufflers. The 2nd picture was taken after I wiped off a thick layer of oil. Is it possible that were the drive shaft and the rear diff meet could have a leak? The red arrow in the last picture has a little bit of play, but I think that's normal.

My first guess was that the cover had a leak, but I didn't see anything.

Any ideas would be a great help!

 

Looks like the pinion seal is leaking, and the play is only normal if it is only a little bit and the play is not in the u-joint. Good luck...

 

Looks like an easy swap so i'm going to give that a shot. Thanks for the advice Petrock.

 

Make sure you google on how to change it. You have to put that pinion nut back at the correct torque or you ruin the crush sleeve

 

It is not the torque of the pinion nut that is critical, but rather the torque required to turn over the differential, an indicator of the pinion bearing preload.

Here is the procedure, from the shop manual...

 

Thanks for that link Cliffyk