An oil–water emulsion from the machinery industry was treated using Fenton's reagent. The objective was to reduce the high chemical oxygen demand (COD) of this waste stream so that it would meet the COD effluent limit of Chinese Standard JS-7740-95. The optimal [H2O2]/[Fe2+] ratio for COD removal was 3. An orthogonal experimental design was developed based on the optimal [H2O2]/[Fe2+] ratio to evaluate the significance of four parameters relevant to the treatment process, namely, H2O2 dosage, initial pH, oxidation time and coagulation pH. The influence of the four parameters on COD removal efficiency decreased as follows: H2O2 dosage > oxidation time > coagulation pH > initial pH. The COD removal efficiency was further investigated based on the most important single-factor parameter, which was H2O2 dosage, as discovered in the orthogonal test. A well-fitted empirical correlation was obtained from the single-factor analysis and up to 98% COD removal was attained using 50 mM H2O2. Using the doses and conditions identified in this study, the treated oil–water emulsion can be discharged according to Chinese Standard JS-7740-95.