The present article describes the calibration of ultrasonic immersion transducers using reciprocity technique. A step-by-step procedure and instrumentation requirements for transducer calibration are presented. Challenges encountered during the calibration experiment such as diffraction and attenuation corrections, and mismatched electrical impedances were also explored. The calibrated transducer was used to measure the acoustic nonlinearity parameter (β) of distilled water using the finite amplitude method. The objective of the current study is to identify potential challenges while moving towards a nonlinear immersion scanning technique for immersed engineering solids. Challenges such as effect of additives (corrosion inhibitors, surfactants etc.), misalignment of transducers, and effect of longer propagation paths were explored. Additives to distilled water were found to decrease the β of the mixture, and for an axial transducer misalignment of 2 mm, β was observed to increase by a factor of 2. Finally, the effect of propagation distance and excitation amplitude is shown.