probably in the fuel tank and is very hard and dangerous to fix. Gas was not refined enough a year ago that blew a bunch of sending units in GM cars. Some other addative or funky fuel could have done this in your ford? Guage usualy jumps around when this happens. Look for a loose connectiion above the fuel tank. Otherwise the gas needs drained, tank needs dropped, and fuel-pump / sending unit needs removed using a wood/brass bar making sure not to blow yourself up while beating on the gas-tank.
Rick