When buying a used car, the transmission is worthy of detailed inspection. Replacement or repair can sometimes exceed the price of the used car you are considering. First, check the fluid for color, smell and level. The fluid should be between pink and red in color, never brown or black (which would also have a burnt smell to it, indicating lack of servicing and possible internal damage). Check the transmission fluid level at operating temperature (with the engine idling), with the car on level ground, with the transmission in park and the emergency brake on. If the Owner's Manual says the fluid has to be checked with the transmission in neutral, BE SURE TO PUT EMERGENCY BRAKE ON. Look under vehicle (or where you suspect its usually parked) for transmission leaks. A spotted driveway is a good indication of leaks.
When you take the vehicle on a road test, before letting the car move, give the vehicle a little gas. If you hear any "whining," it could indicate internal transmission wear or damage. Then check the transmission's engagement, by shifting from park to drive, noting how long it takes the transmission to engage. Shift from drive to reverse, and observe how long it takes to engage. The transmission should engage quickly and firmly, and not slide into gear. If you hear any banging, grinding, whining and squeaking, which can be caused by a worn or broken engine or transmission mount, or possible internal problems. On newer vehicles, proper engine idle settings can improve transmission performance and engagement. If an engine's idle speed has been tampered with, the transmission will not operate properly.
When road testing the vehicle, watch for transmission shift points, when the transmission shifts gears. These shift points should be smooth yet firm. You want the transmission to neither slip into gear nor slam in. Drive the vehicle at highway speed to ensure you have gone through all the gears. After the car is at highway speed, press accelerator slightly to increase speed. If the transmission slips and does not down-shifts properly, you may have highway passing problems (think passing an RV with a truck in the on-coming lane), which will require a transmission adjustment.