My 88 is leaking fuel from this weep hole in the transmission when ever it's running. What's causing this and how do I stop it?

 

I can't think of anywhere inside the transmission bell housing it could be coming from. Maybe someone else knows of a place. I would think the leak is somewhere under your manifolds where your fuel lines, injectors, regulator and pulsation dampener are and it's running into the bellhousing from the top then finding it's way out that weep hole. Look at the pulsation dampener. They are know to leak on the 86-88 cars.

 

When looking for a leak, start at the top looking down.

probably a leaking fuel pulsation dampener, fuel hose, or fuel injector seal/o-ring.

fix it and I’d recommend not driving it. Can easily lead to a fire.

 

As mentioned above : DO not drive the vehicle. Remove the battery cables, and begin removing the upper intake manifolds. The fuel supply and return hoses connect under the plenum area and then onto the fuel rails on the passenger side of the vehicle. DO not drive the car, engine fires are very easy to start with a hot exhaust manifold. Google search, Leaking pulsation damper

FC3S Pro v2.0: FAQ - Pulsation Damper

Good luck

-M