Analysing the multi-phase flow behaviour of low-altitude unmanned aerial vehicles (UAVs) operating in proximity to water surfaces can provide valuable data for optimising the design and operational parameters. This study presents a comprehensive numerical analysis of the flow parameters of a fuselage equipped with a propeller operating near a water surface. The investigation focuses on the effects of varying the height-to-radius ratio (h/R) of the fuselage from the water surface, with values set at 1, 0.6, and 0.3. With the assistance of the CFD analysis, a two-dimensional computer model of a fuselage with a propeller has been created for the present study. To characterise the flow interaction of the two phases and to accurately estimate hydrodynamic and turbulence properties under various situations, the volume of fluid (VOF) approach based on an Eulerian flow scheme is used. The turbulence flow visualisation and flow parameters such as velocity, pressure, and volume of fluid (VOF) have been evaluated along with the lift coefficient (Cl), drag coefficient (Cd), and pressure coefficient (Cp) around the fuselage. The results reveal significant insights into the interaction between the propeller-induced flow and the water surface, highlighting critical changes in aerodynamic performance as the height varies.