Abstract: No breakthrough has been gained in the Mesozoic and Cenozoic deposits in the South Yellow Sea Basin after years of oil and gas exploration. This paper is devoted to the sedimentary characteristics and evolutionary history of the Funing Formation and Sanduo-Dainan Formations of Paleogene. Drilling data, seismic data and well logging data suggest that the Funing Formation and Sanduo-Dainan Formations are mainly composed of four types of facies, i.e. fluvial facies, fan delta facies, deltaic facies and lacustrine facies, and the fluvial facies can be further divided into braided fluvial facies and meandering fluvial facies in the study area. Lithology and electrical properties of all the sedimentary facies, subfacies and mcrofacies are fully studied. Seismic facies are then established for the two Formations as the result. According to Walther's law, the spatial distribution pattern of facies is described based on well data and seismic data. Our results indicate that the Funing Formation is dominated by meandering river facies, fan delta facies, coastal and shallow lake facies and semi-deep lake facies; and the Sanduo-Dainan Formations dominated by braided fluvial facies, fan delta facies and nearshore lacustrine facies. Sedimentary evolutionary history is established through facies analysis and the study of tectonic background of the two formations.