The oxide inclusion characteristics such as, size, number density, composition, and oxidation sequence control the microstructure development in steel welds. In the previous work at ORNL, an inclusion model was developed to describe the inclusion formation as a function of weld metal composition and process parameters. In the present investigation, the effect of fluid flow on the inclusion growth was considered. The fluid flow conditions during welding were approximately simulated using a thermo-mechanical simulator. The results of this investigation showed that small inclusions in the liquid steel collided and coalesced into larger inclusions. This type of inclusion growth was found to be rapid than coarsening by diffusional growth. The calculations from theoretical model of collision and coalescence agreed with the experimental observations. The rate of collision and coalescence of inclusions was found to be proportional to the gradient of fluid flow velocity, residence time, and the size.