Effective water management is one of the key strategies for improving low temperature PEM (Proton Exchange Membrane) fuel cell performance and durability. Phenomena such as membrane dehydration, catalyst layer flooding, mass transport and fluid flow regimes can be affected by the interaction, distribution and movement of water in flow plate channels. In this paper a literature review is completed in relation to PEM fuel cell water flooding. It is clear that droplet formation, movement and interaction with the GDL (Gas Diffusion Layer) have been studied extensively. However slug formation and droplet accumulation in the flow channels has not been analysed in detail. In this study, a CFD (Computational Fluid Dynamic) model and VOF (Volume of Fluid) method is used to simulate water droplet movement and slug formation in PEM fuel cell mini-channels. In addition, water slug visualisation is recorded in ex situ PEM fuel cell mini-channels. Observation and simulation results are discussed with relation to slug formation and the implications to PEM fuel cell performance.