Produced water is the largest liquid effluent in volume generated in petroleum production. It originates from natural wells or from water that was previously injected during the exploration process. The composition of produced water is complex, containing high salt concentration, emulsified oil, suspended solids, chemical additives used in the various stages of oil production, heavy metals, and other contaminants. Several technologies can be used in the treatment of produced water in order to meet the conditions specified in local legislations and the most used are phase separators, decanters, cyclones, and filters. The separation process mechanism of oil emulsions by coalescence in fibrous media has excellent results, though it is not fully understood and is frequently based on empirical, as well as on experimental, observations. This article presents a general overview on produced water, including origin, production, composition, environmental impact, treatment techniques, disposal, and legislation, as well as an updated discussion utilizing recent literature regarding the unit operation of coalescence: general aspects, kinetics, mechanisms, and factors that influence the coalescence process.