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Read your owner's manual. This information can be found there. I have a 1999 BMW 323i and have searched the owner's manual for info on changing the oil and filter and have found minimal information. The owner's manual DOES NOT show the location of either the oil filter or the oil drain plug. It seems that BMW doesn't think that owners should be doing seemingly simple maintenance like changing oil on their cars. This is the first car I have owned that oil changes are not straight forward. Very disappointing. Here is a site that lists many DIY (Do It Yourself) projects, including oil changes. There are two links for changing oil in an e46. Including pictures of where the drain plug is located. http://www.bimmerdiy.com/e46 I have found being a member of the BMWCCA club and finding websites dedicated to BMWs a HUGE help in maintaining my BMW. Hope that helps, -Brian the oil filter location is under the hood next to the Power Steering fluid reservoir(on the left of the air filter box)it's a very big bolt and you need a special wrench to unscrew it
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