The pilot, who was also the owner of the experimental amateur-built airplane’s kit manufacturer, was performing a demonstration flight for potential buyers. The pilot reported that after fueling the airplane, a preflight inspection was performed and no anomalies were found; however, he stated that he did not sump the fuel tanks or the low-point drains. The pilot stated that after performing the engine runup and allowing the engine to reach operating temperatures, he performed a normal take off. At around 300 ft above ground level, the pilot reported that the engine began to “cut out,” and the pilot pulled the throttle bringing the engine to idle. He then began a left turn back toward the runway and advanced the throttle; however, the engine lost complete power. The pilot realized that he would not make it back to the runway and performed a forced landing into a wooded area. A postaccident examination of the airplane revealed that it had sustained substantial damage to the wings. Examination of the engine found evidence of water in the fuel flow divider. After draining both wing fuel tanks, a significant amount of water was observed in the right wing fuel tank. According to the pilot, there were no fueling services available at the departure airport, and so he would fill barrels with fuel and store the barrels at the airport. According to the individuals who fueled the airplane that morning, when fueling the right fuel tank, they needed to tip the fuel barrel all the way on its side to get the last remaining fuel. Based on this information, it is likely that when the right fuel tank was filled, water that had accumulated in the fuel barrel was poured into the right fuel tank, which was then not drained during the preflight inspection. Subsequently, during takeoff, water likely entered the engine’s fuel system and cylinders, resulting in the reported loss of power.