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Borrowed from the interweb:
Just b/c this has manifested itself recently on some threads, I thought I'd post some definitions and a how to for those of us who aren't mad mechanics. Thanks to Yahoo Auto's for the brief info.

What does a compression test tell me?

It will tell you if your engine has good compression. An engine is essentially a self-powered air pump, so it needs good compression to run efficiently, cleanly and to start easily.

As a rule, most engines should have 140 to 160 lbs. of cranking compression with no more than 10% difference between any of the cylinders.

Low compression in one cylinder usually indicates a bad exhaust valve. Low compression in two adjacent cylinders typically means you have a bad head gasket. Low compression in all cylinders would tell you the rings and cylinders are worn and the engine needs to be overhauled.

CHECKING COMPRESSION

Compression can be checked two ways: manually with a compression gauge or electronically with an engine analyzer. The manual gauge method is the only one available to most do-it-yourselfers.

To check compression, all the spark plugs are removed. The ignition coil is then disabled or the high tension lead is grounded. The throttle is also held open. The engine is then cranked for a few seconds using a remote starter switch or a helper while a compression gauge is held in a spark plug hole. The maximum compression reading is noted, then the process is repeated for each of the remaining cylinders. The individual cylinder readings are then compared to see if the results are within specs (always refer to a manual for the exact compression specs for your engine because they do vary from the ballpark figures we quoted earlier).

If compression is low in one or more cylinders, you can isolate the problem to the valves or rings by squirting a little 30 weight motor oil into the cylinder through the spark plug hole and repeating the compression test. The oil temporarily seals the rings. If the readings are higher the second time around, it means the rings and/or cylinder is worn. No change in the compression readings tells you the cylinder has a bad valve.

With electronic testing, a computer analyzer "estimates" compression in each of the engine's cylinders by measuring slight variations in engine cranking speed. The results correlate well with actual gauge readings and can be completed in a matter of minutes without having to remove any spark plugs. What's more, the analyzer prints out the results of the compression test making it easy to see and compare the actual numbers.



LEAK TEST

What is a "leak down" test?

Answer: A leak down or "cylinder leakage" test is similar to a compression test in that it tells you how well your engine's cylinders are sealing. But instead of measuring pressure, it measures pressure loss.

A leak down test requires the removal of all the spark plugs. The crankshaft is then turned so that each piston is at top dead center (both valves closed) when each cylinder is tested. Most people start with cylinder number one and follow the engine's firing order.

A threaded coupling attached to a leakage gauge is screwed into a spark plug hole. Compressed air (80 to 90 psi) is then fed into the cylinder.

An engine in great condition should generally show only 5 to 10% leakage. An engine that's still in pretty good condition may show up to 20% leakage. But more than 30% leakage indicates trouble.

The neat thing about a leakage test (as opposed to a compression test) is that it's faster and easier to figure out where the pressure is going. If you hear air coming out of the tailpipe, it indicates a leaky exhaust valve. Air coming out of the throttle body or carburetor would point to a leaky intake valve. Air coming out of the breather vent or PCV valve fitting would tell you the rings and/or cylinders are worn.

A leakage test can also be used in conjunction with a compression test to diagnose other kinds of problems.

A cylinder that has poor compression, but minimal leakage, usually has a valvetrain problem such as a worn cam lobe, broken valve spring, collapsed lifter, bent push rod, etc.

If all the cylinders have low compression, but show minimal leakage, the most likely cause is incorrect valve timing. The timing belt or chain may be off a notch or two.

If compression is good and leakage is minimal, but a cylinder is misfiring or shows up weak in a power balance test, it indicates a fuel delivery (bad injector) or ignition problem (fouled spark plug or bad plug wire).
 

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You can also mention that if two adjacent cylinders (1 and 3, or 2 and 4 on our specific motors) both have low compression, its most likely from a leaking head gasket between the two cylinders.

Another/different sign of a leaky HG is when doing a leakdown test, if you take off the rad cap and see bubbles forming, its from the compression(air) leaking past the HG, into the coolant jackets.
 

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I know this is back from the dead but what about compression tests across the board around 150psi give or take 1 psi and leakage at nothing almost on 3 and about 10% on 1 cylinder only?
 
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