Abstract: In order to identify the structural evolution, Paleogene sedimentary characteristics, and hydrocarbon conditions of Sanmenxia basin, the authors studied the structural evolution, fault development, and sedimentary facies characteristics of Sanmenxia basin based on the two-dimensional seismic interpretation, drilling logging data, outcrop features, experimental data, and other data. And the potentials for oil and gas exploration were discussed. The results show that normal faults under 3 active periods were developed in Sanmenxia basin. The first-period faults are basin-controlling faults at the end stage of Yanshanian orogenic movement. The second-period faults are basin internal control concave faults in the Himalayan period. The third-period faults are intra-basin tear faults in Pleistocene System. Sanmenxia basin has experienced five evolutional stages: Precambrian metamorphic basement and depression trough formation stage, Paleozoic transgression and orogeny stage, the formation stage of Mesozoic graben type faults basin, the development stage of Paleogene faults basin and basin finalization stage. Four sedimentary facies, including alluvial fan facies, meandering river facies, delta facies and lacustrine facies, 9 sedimentary subfacies and 15 sedimentary microfacies were identified. Organic carbon content of dark mudstone in Xiao'an Formation is 2.7%, indicating good material base for hydrocarbon generation. The distribution range of vitrinite reflectrance is 0.7%~1.1%, Hydracarbon Source rocks enter the main hydrocarbon production stage, and the organic matter type is mainly type Ⅱ with some of type Ⅲ, indicating medium-good source rock. The delta facies and alluvial fan facies lay the foundation for reservoir development, with the average porosity of 19.79% and the permeability of (5~150)×10^-3 μm², indicating medium porosity -medium low permeability reservoir with good physical properties. The source-reservoir-cap assemblage of lower-source and upper-reservoir model and self-generation and self-storage model was developed. It is speculated that the type of new source and old reservoir model is also developed, meaning it has material basis and geological conditions for the formation and enrichment of oil and gas. The industrial oil flow was obtained during the drilling of Yushandi No.1 well, which further confirms that Sanmenxia basin has certain potentials for oil and gas exploration.