A hydraulic fluid or hydraulic liquid is the medium by which power is transferred in hydraulic machinery. Common hydraulic fluids are based on mineral oil or water. Examples of equipment that might use hydraulic fluids are excavators and backhoes, hydraulic brakes, power steering systems, automatic transmissions, garbage trucks, aircraft flight control systems, lifts, and industrial machinery.

Hydraulic machines use liquid fluid power to perform work. Heavy construction vehicles are a common example. In this type of machine, hydraulic fluid is pumped to various hydraulic motors and hydraulic cylinders throughout the machine and becomes pressurized according to the resistance present. The fluid is controlled directly or automatically by control valves and distributed through hoses, tubes, or pipes.