Windage losses arise due to viscous dissipation of air - oil mist flow driven by the rotating faces, sides of the gears in a gearbox. In the open literature, theoretical investigations mostly focused on the single phase (air) flow. Thus there is research need for the analysis of the windage losses under more realistic conditions. In the present study we attempt to elucidate the complex flow physics between the gears by considering the effects of oil particles in the highly turbulent air flow. The goals of this work is to develop physical understanding of the aerodynamics of gear windage loss. A spur gear geometry was considered, for which experimental and theoretical data are available. A commercial Computational Fluid Dynamics algorithm (CFD++) was utilized for the numerical simulations.Various shrouding configurations and free spinning cases are studied at different rotation speeds of the gear. The effects of the oil droplets on the windage losses were quantified.