Abstract: The northern fault zone of the Northern Sag was formed in the period of Late Paleogene in the South Yellow Sea Basin. It occurs between two normal strongly active faults as a depression-uplift structure on a faulted anticline covered by the Neogene and Quaternary deposited in the depression stage. The source rocks, which formed latter in time, are deeply buried and close to the depression center, and characterized by bidirectional oil supply. Faulted anticline traps, nose structure traps, and the overlap and unconformity sealed traps are locally developed, which matched well with source rocks, reservoirs and cap rocks, forming a good combination for hydrocarbon accumulation. In this paper, we based our conclusions on the research of the Mesozoic-Cenozoic movement of the northern part of the faulted terraces, together with local tectonic evolution and their petroleum potentials. Exploration targets are suggested based on the research.