The kerosene–water flow in vertical and inclined pipes of 77.8 mm inner diameter and 4500 mm length has been investigated numerically. Simulations were carried out at three inclination angles of 0°, 5° and 30° from vertical for superficial water velocities in the range of 0.29–1.6 m/s and volumetric qualities in the range of 9.2–65.5%. Results from the simulations have been compared with the corresponding experimental data from our previous study to check the suitability of meshing, physical models and boundary conditions used. The results from CFD predictions show a reasonable agreement with the experimental data for the vertical pipe. Some discrepancies have been observed near the walls for inclined pipes as the flow becomes more complex with the appearance of drops swarms. The same computational domain was then used to investigate the effect of a higher volumetric quality and superficial water velocity on the flow characteristics. The axisymmetrical distribution of the volume fraction, water velocity and drops velocity which were observed in the vertical pipe has changed into asymmetrical distribution in the inclined pipe. It has also been observed that increasing the superficial water velocity and volumetric quality modifies the distributions of flow parameters due to the movement of kerosene drops toward the lower part of the pipe. The results from CFD predictions on the volume fraction distribution at 30° inclination indicate the appearance of phase inversion phenomenon when the volumetric quality becomes greater than 65%.