Project E36 M3 - Valve Cover Gasket Replacement May 19 2022

Eventually, the valve cover gasket starts to leak and get oil all over the headers and engine block. Besides making a mess in the engine bay, burning enough oil on hot headers can start a fire. If the valve cover gasket is leaking badly enough, it can cause rough idling by letting unmetered air into the engine via the positive crankcase ventilation system. This isn't a difficult job, but it can take some time and attention to detail to keep foreign debris from getting in the head.

BMW E36 M3 with location of oil leak from the valve cover circled.

It may be difficult to see it in the photo, but there was some obvious leaking from this grommet. Be sure to order new grommets and washers any time you replace the valve cover gaskets. There was also oil visible running down the engine block and headers.

BMW E36 M3 beauty cover fastener cap being pried off.

We remove the engine beauty cover first. We do this by prying up the two covers with a small flathead screwdriver and undoing the nuts holding the cover down. Remove the oil fill cap as well.

BMW E36 M3 engine with beauty cover removed.

This is how things look with the engine beauty cover off. I like to put the oil fill cap back on after the engine beauty cover is removed. It is a convenient place to store the cap, and it keeps foreign objects from getting into the valve cover.

BMW E36 M3 fuel rail beauty cover fastener location.

Remove the smaller engine beauty cover as well. It comes off the same way as the larger engine beauty cover.

Screwdriver prying up on the harness connector lock for the ignition coils.

Remove the electrical connectors from the ignition coils. Do this by lifting up on the metal retaining clips and then pulling out the connector. Next, remove the ignition coils by removing the two bolts holding each ignition coil on, and pulling them up out of the spark plug holes. Sometimes they get a bit stuck, and some silicone spray lubricant, wiggling and twisting can help. Being too aggressive can pull the rubber boot off of the coil pack.

BMW E36 M3 S52 engine with ignition coils removed.

This is how it looks like with the ignition coils removed.

Wrench and socket loosening nut that holds the ground wire to the valve cover.

Remove the ground wire by loosening the nut holding it on. If the stud starts to spin, hold it in place with a wrench while loosening the nut.


Wrench holding stud so that nut securing the ground strap can be loosened.

Remove the two braided grounds as well. Here, we had to use a slim midget wrench to hold the stud in place while removing the nut.

Harness being disconnected from the valve cover.

Unplug the electrical connector by twisting it counter clockwise and then lifting up.

How to remove the positive crankcase ventilation hose.

Remove the positive crankcase vent hose by squeezing the retaining ring and then pulling the hose off.

Capping the crankcase ventilation system components with fingers from a nitrile glove.

I like to cap the open ends of the valve cover and the positive crankcase ventilation hose so that debris, bugs or any other foreign objects can't sneak into where they are not supposed to be. I cut the fingers off a nitrile glove and stretched them over the ends.

Locations of all valve cover fasteners circled.

Remove the bolts holding the valve cover onto the head. Then, lift the valve cover off and maneuver it out of the engine bay. If the valve cover is stuck on the head, sometimes a few whacks from a rubber mallet can help loosen it. Remove the gasket that goes around the perimeter and remove the two spark plug hole gaskets as well.

BMW E36 M3 engine with valve cover removed.

The last time we replaced the valve cover gasket, we used some Room Temperature Vulcanizing sealant (RTV) around the perimeter of the valve cover. We now have to remove all the old RTV, while being careful not to drop pieces of it into the head. For this reason, we don't recommend running a bead of RTV around the entire perimeter of the valve cover. We also haven't experienced any improved sealing from the use of RTV around the perimeter either. In fact, the gasket alone seems to seal better because it has several ridges that provide multiple layers of seals that the oil has to get through. Contrast this with the RTV, which doesn't have multiple layers of seals to defend against leakage.

A razor blade is our weapon of choice for removing old RTV. Be careful not to nick the surface of the head with the razor blade. A razor blade holder or a gasket scraping tool can make life easier, but we didn't use one. Note that the timing chain goes all the way down into the oil pan. If you drop anything down that hole, you're likely going to have to drop the oil pan to fish it out, so be very mindful of this. You may choose to place a rag in the gap to lessen the chance of a fastener or a tool falling in.

Cam tray cover being removed from BMW E36 M3.

Remove the cam tray cover for better access. Simply pry up on one of the edges and lift it off.

Paper towels stuffed in E36 M3 head to catch old RTV that is being removed.

Working along the upper perimeter of the head, we like to put a paper towel or rag in place to help catch any bits of old RTV from going into the head. It also saves you the trouble of having to try to fish out a dropped razor blade. Cleanliness is important here, because old pieces of RTV can clog oil passages, and dirt can become an abrasive in your engine. The hydraulic lifters in particular have very small passages that can be clogged easily. Any tools lost in the head will likely end up destroying your engine. We do not recommend using Scotchbrite to clean off the last remnants of RTV. Scotchbrite is made up of fibers impregnated with abrasive aluminium oxide particles. These particles will shed and get into your engine and accelerate wear. This is why it is hard for me to fully trust shops with a job like this. You really need to be careful, clean, meticulous and avoid shortcuts like using Scotchbrite.

BMW E36 M3 timing chain components.

Now is a good time to take inventory of the condition of the valvetrain components. Are the camshaft sprockets worn? They will get pointy teeth when they wear down. Do the timing chain guides show wear?

BMW E36 M3 cams inside cam trays. Inspecting the cam lobes for wear.

Do the cams have any signs of wear? You'll see scoring on the cam lobes.

Shop Vac with homemade nozzle made from a boba straw for getting down into the hard-to-reach crevices of the head and vacuuming up the bits of old RTV.

After the gasket surface was clean, we vacuumed out any bits of RTV with a boba straw duct taped to the end of our shop vac. 

Tube of Permatex Ultra Black in the original packaging.

This is the RTV that we used. Permatex RTV.* If your RTV has been opened previously and has been sitting around for more than a year, it's a bit risky to use in our opinion. Opened RTV does have a shelf life in our experience, and it gets hard over time. 

Location where RTV is needed at the junction of the head and the timing case.

We placed a small bead of RTV on the seam where the head meets the front timing cover. There are two locations. The upper location is shown.

Location of where RTV is needed at the corners of the semi-circular cutouts.

We also put a dab of RTV on the corners of the half-moon cutouts on the aft side of the engine. There are four locations total. Only two are shown above.

Valve cover with new valve cover gaskets installed.

Place the new gaskets onto the valve cover. Don't forget about the two spark plug hole gaskets in the center. Sometimes these gaskets will want to fall out once you flip the valve cover right-side-up. It is possible to use a bit of RTV to keep the gasket in place, but use it sparingly because it will create more work to clean up next time.

BMW E36 M3 head with cam tray cover reinstalled.

Don't forget to put the cam tray cover back on before putting on the valve cover. This is also your last chance to check for any foreign objects in the head. Did you stuff any rags or paper towels anywhere earlier? Put the valve cover on. Use new grommets and washers on reinstallation. BMW advises to replace the washers every time. I'm not sure what's so special about these washers. For anyone interested in sourcing some less expensive washers, the outer diameter is 0.895 inches (22.7 mm), the inner diameter is 0.410 inches (10.4 mm), and the thickness is 0.064 inches (1.6 mm). We went with the genuine BMW washers though.

Torque down the bolts to 89 inch pounds (NOT foot pounds). This is not very much torque at all, so be careful. Once the bolt bottoms out, don't push it much further. The nuts that hold the ground wires on are even small and just need to be barely snugged up.

Put everything back on in the reverse order that you took them off. Congratulations on replacing your valve cover gasket and having no more leaks from the valve cover.

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