Safety first: Turn OFF power or gas if water is contacting electrical components.

Identify source: Dry the area and observe while the heater operates. Look for drips from fittings, T&P valve, or flue.
Check fittings: Tighten or re-seal hot and cold nipples and T&P valve threads with appropriate thread sealant.
Condensation: Light condensation on a new or recently filled heater may be normal and should diminish with use.
External leaks: Inspect ceiling and nearby plumbing for leaks that may be dripping onto the heater.

Rheem water heater shows condensation or water on top of the tank

Possible Causes