As an essential material in various industries, steel’s internal defects can seriously affect its performance and cause huge economic losses. To investigate the source of internal fault defects in oil drill pipes, this study used ultrasonic testing equipment to accurately locate internal fault defects in steel, and obtained the spatial coordinates of the defects as (2.15, 2.29, 0.77). Then, by dissecting layer by layer, the target defect was determined to be a large Al2O3 inclusion with a length of 1.609 mm and a width of 0.2 mm. Afterwards, based on the results of automatic scanning of inclusions, this study used extreme value statistical method to estimate the maximum size inclusions that may exist in steel, and found that the target defect size was much larger than the estimated value. Finally, to further determine the source of large inclusions, this study conducted sampling and analysis on immersion nozzles, refining slag, tundish slag, and mold flux. The study found that the matching degree between the composition of large inclusions and the composition of submerged nozzle nodules was the highest, indicating that the fault defect was caused by the peeling of nozzle nodules. This indicates the direction for process optimization.