Slug flow is a common flow pattern in the liquid–liquid two-phase flow in microchannels. It is an ideal pattern for mass transfer enhancement. Many factors influence the slug formation such as the channel geometries (channel widths, channel depth), flow rates of the two phase, and physical properties. In this paper, in order to investigate the liquid–liquid two-phase slug formation in a T-junction microchannel quantitatively, the volume of fluid (VOF) method is adopted to simulate the whole slug formation process. With the validated model, the effects of the disperse phase channel width, channel depth, and two-phase flow rate ratio on slug formation frequency and slug size (slug volume and slug length) are analyzed with dimensionless parameters. Dimensionless parameters include the disperse-to-continuous phase channel width ratio, height-to-width ratio, and two-phase flow rate ratio. Results show that both the channel geometry and two-phase flow rate ratio have a significant influence on slug formation. Compared with the conventional slug formation stages, a new stage called the lag stage emerges when the disperse phase channel width decreases to half of the continuous phase channel width. When the channel depth decreases to one third of the continuous phase channel width, the flow patterns become unstable and vary with the two-phase flow rate ratio. Moreover, empirical correlations are proposed to predict the slug formation frequency. The correlation between slug formation frequency and slug volume is quantified.