This paper presented the method to detect the degradation level of insulation oil for transformer. Degradation of insulation oil for transformer is due to both mechanical and chemical deterioration. Metallic particle and organic material such as a dust are known as the main reason of mechanical deterioration. According to degradation and oxidation of insulation oil for the time of transformer operation, total acid number (TAN) will be increased, sludge will be appeared, and finally conductivity will be decreased. Designed sensor., which is an inter-digit capacitive type, was fabricated by using MEMS technology. Size of sensor is 9 mm (length) x 7 mm (width) x 1 mm (thickness). From the tested result, when the oil is aged, the capacitance increases and the impedance decreases. And the result shows the good proportionality with time.