Oil retention in a microchannel type condenser was measured and its effect on heat transfer rate performance and pressure drop were analyzed for refrigerants R410A and R134a condensation. The heat exchanger was a 2-pass aluminum louvered-fin type consists of multiports rectangular channels with hydraulic diameter of 0.06 inch (1.7 × 10−3 m). The refrigerants and Polyolester oil mixtures were studied at saturation temperature from 85 to 130°F (29 to 54°C) and oil mass fraction (OMF) was varied from 0 to 6 wt.%. Oil retained in the condenser was found to be strongly dependent on the OMF and it was measured up to 11% of its internal volume. The oil retained for high mass fluxes were higher than those for low mass fluxes. The effect of mass flux on the oil retention was small for low OMFs but became more evident for OMFs of 3 wt.% and higher. The oil penalized the heat transfer capacity by as much as 10% when the OMF was 3 wt.%. For medium temperature of 105°F (41°C) the heat transfer capacities were fairly constant. Nevertheless, the high refrigerant-oil mixture viscosity of the liquid phase increased the pressure losses up to 19% compared to that in oil free conditions.