From E30 Zone Wiki

Over time, the rubber seals that make up your brake calipers will degrade until your brakes no longer work. Rather than fork out for massively overpriced new calipers, learn how to strip down, clean, and rebuild the most complex part of your braking system.

This article was taken from rv3limited.com, and all copyright is held by the original poster

Disassembly

Start with a clean work surface. It is essential that no dirt gets into your brakes during this process. Then lay out your rebuild kit(s)

On the rear calipers, remove the retaining ring

Pull the ring and boot off

If you have compressed air, shoot a little into the brake line hole. be careful as the piston will come out pretty quick so stick a rag or a block of wood in between the piston and the caliper so that it doesn't do any damage. if you don't have compressed air, you can use a bike pump with the cone nozzle

After you get the piston out, pull out the inner seal careful not to scratch the wall of the caliper bore

Clean out all the nasty stuff with brake clean and a toothbrush (nothing metal, so you don't scratch the walls)

Reassembly

Now it's time to put it all back together. soak your inner seals in clean brake fluid

Fit the new inner seal in it's slot and then stretch the boot over the piston as here

Spread some brake fluid on the piston and bore walls and carefully push the piston back in. You should be able to do it with just your hands. If you get stuck, take it out and try again, but don't get frustrated if it takes you a couple of tries

Put the retaining ring back on and you're all set

The fronts are a little harder than the rears; pull the boot over the piston like this

Tuck the boot into the slot in the caliper as shown. It's hard, so take your time. It helps to lube it all up with brake fluid

Push the piston in until the front of the boot slides into its own slot