Gas evolution and expansion is a natural phenomenon in most oil and gas wells. However, gas is detrimental to pumping artificial lift systems, causing incomplete pump fillage and reduced pump efficiency. This makes it essential to separate the gas before a pump's intake. Various downhole separators with questionable efficiencies are available today. In this study, an automated experimental separation facility is presented, and efficiency of a novel centrifugal separator is tested. The setup includes a 31-ft horizontal section followed by a 27-ft vertical section that contains the centrifugal separator. The performance of the separator is evaluated at different air (34–215 Mscf/d) and water rates (17–867 bpd). The multiphase-flow loop is equipped with pressure transducers and control valves for effective flow control. Data acquisition and process control are performed using Labview™.A newly designed packer-type centrifugal downhole separator is used for all the tests. It takes an average of 5 min to establish steady-state flow in tubing return line. Liquid separation efficiency is a measure of the ratio of the inlet liquid produced at the tubing return line. Separation efficiency is close to ideal (100%) for liquid rates up to 500 bpd. The efficiency slightly reduces at higher liquid rates, but stays above 80%. The decline in efficiency is sharper for higher gas rates (over 300 SCF/STB). The effects of liquid level in casing on separation are also tested. The flow pattern in the tubing is intermittent for all the tests, while various flow patterns in casing are also visualized and recorded. With declining rates of production from oil fields, efficient artificial lift is necessary. This system provides a unique and novel tool to simulate the dynamics of flow in wellbores.