Work through it in order

1

Check the inlet and outlet connections

The cold-water inlet and hot-water outlet connections at the top of the tank are the most common and easiest source to fix. Hand-tighten or use a wrench for a quarter turn, since thermal expansion over years of use can loosen these fittings slightly without any other sign of a problem.

2

Check the T&P valve

The temperature and pressure relief valve, mounted on or near the top of the tank, is a safety device that releases water automatically if pressure or temperature inside the tank climbs too high. A valve that drips only occasionally, especially after heavy hot-water use, may simply be relieving excess pressure as designed. One that drips constantly needs replacing, not just tightening, since it's a safety device, not a fitting to seal shut.

3

Inspect the inlet and outlet nipples

The nipples, the short pipe fittings connecting the tank to household plumbing, can show visible corrosion, more common on older units. Look for rust-colored staining or pitting right at the connection point rather than a clean drip.

4

If tightening and the valve both check out and the leak continues

Treat this as a case for a plumber rather than continued guesswork. Confirming a nipple or valve failure at this point usually means draining the tank, which isn't a simple DIY step.

Why you should never plug or cap a leaking T&P valve

The T&P valve exists specifically to release pressure before the tank can become dangerous, and blocking it to stop a drip removes that safety margin entirely. A constantly dripping valve should be replaced, never sealed, no matter how tempting a quick cap or plug looks compared to a plumber's visit.