The lower unit on a Mercruiser Alpha or Bravo type stern drive can be low on oil because it wasn't filled to capacity when last serviced or because there's a leak in the system. In either case, it's important to know how to add lower unit oil, called gear lube, to prevent damage to the components inside the outdrive.
Look on the upper left side of the lower unit housing for a slotted plug on either an Alpha or Bravo type outdrive. The word VENT is cast into the aluminium just above the plug.
Look on the lower left side of the propeller shaft housing on an Alpha type outdrive for a slotted plug. This is the drain/fill plug but it's not marked.
Remove the propeller nuts and washers on a Bravo type stern drive using a propeller wrench which will fit the lock washers and propeller nut, then slide the propeller off the propeller shaft.
Look for a slotted plug, just under the propeller shaft. This is the drain/fill plug.
Use the tilt and trim mechanism on the boat to lower the outdrive to its vertical or operating position.
Use a slotted screwdriver to remove both of the plugs.
Attach a gear lube pump to a bottle of gear lube.
Screw the fitting on the end of the hose on the gear lube pump into the drain/fill opening.
Pump gear lube into the outdrive until it begins to ooze out the vent hole.
Remove the gear lube pump from drain/fill opening.
Reinstall both plugs. Wipe oil off the exterior of the unit and any oil which has dripped to the floor with a paper towel.
Some Alpha and Bravo stern drives are fitted with a remote gear lube reservoir in the engine compartment. If your boat has one, fill it to the full line marked on the plastic reservoir by removing the cap and adding gear lube. Keep a small amount of gear lube on the boat to top off the reservoir the next couple of times the boat is used.
If, when you remove the fill/drain plug, water or thin, milky-looking oil runs out, it's a sign you have a leak in the lower unit somewhere. Not only is gear lube leaking out, water is getting in and you need to get the boat to a service shop as soon as possible. They will pressure test the outdrive to find the leak and replace the appropriate seals or gaskets.