Abstract: The characteristics of the hydrocarbon entrapment and evolution of the faults of Neogene System in Zhanhua Sag are studied,and the faults are divided into two types,namely,the large and the small. The effects of the two types of faults in the process of the trapping of oil and gas are respectively discussed in this paper. The large faults dominating the sag control the hydrocarbon migration, collection and entrapment of Neogene System by controlling the hydrocarbon origin, trap forming and migration path of Neogene System. Resulting in the secondary hydrocarbon migration, the secondary faults play an important part in the trapping of oil and gas of the Upper Member of Guantao Formation.