The failure analysis of a leaky inner grooved copper tube (IGCT) was carried out in this paper by means of macroscopic observation, inclusion analysis and fatigue test. Results indicated that the defects introduced in the ball spinning process should be responsible for the leakage. Fatigue test results revealed that the defect in the tube wall was big enough to cause the leakage. Although many micro-scale cracks were observed on the outer surface, these micro-scale cracks are small folding defects in essence. In addition, the chemical composition of the tube material was qualified. Finally, the root cause of the leakage is that the defect in the IGCT material led to the crack initiation and propagation in the tube expansion process. It is suggested that the formation of the defects should be avoided in the production.