A ventilation system for use with an internal combustion engine having a crankcase is disclosed. The ventilation system may have a breather housing connected to ventilate gases from the crankcase, and a filtration canister fluidly connected downstream of the breather housing. The filtration canister may have a filter housing, a filtering medium located within the filter housing to collect oil from the gases, and an oil collection container disposed within the filter housing and being configured to receive at least a portion of the filtering medium. The oil collection container may have a drain port in fluid communication with the crankcase. The filtration canister may also have at least one port configured to discharge the gases from the housing after the gases have passed through the filtering medium.