A significant issue associated with ethanol-gasoline blends is the phase separation that occurs with the addition of small volumes of water, producing an ethanol-deficient gasoline layer and an ethanol-rich aqueous layer. The gasoline layer may have a lower-than-desired octane rating due to the decrease in ethanol content, resulting in engine knock, while the ethanol-rich aqueous layer may not support combustion. Ethanol and ethanol-gasoline blends are not distributed via gasoline pipelines (in which water may be present), but are often proportionally blended just prior to delivery to retail outlets. We report a simple demonstration that effectively illustrates this issue by inducing a phase separation upon addition of a small volume of water to various alcohol-gasoline blends. (Contains 3 figures.)