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Based on core observation and logging analysis, the upper Ganchaigou formation of Youshashan in Qaidam Basin is determined to deposit in the terrigenous clastic transitional environment from the braided delta to the shallow river, through the research on its sedimentary background, source direction, sedimentary structure and analysis of grain sizes. The region is dominated by shallow- water delta front, including the braided distributary channels, interdistributary areas, sub- aqueous distributary channels, sub-aqueous interdistributary areas, mouth bars, distal bars, sheet sands, sand bars, sand beaches, grain banks, shallow-lake sheet sands and mudflats. What’s more, on the basis of single-well facies analysis, integrated with a great mass of geophysical logging and well logging data, a study has been made on the microfacies areal distribution patterns of the six oil layer groups in upper Ganchaigou formation in the region, and it has been found out that the most favorable sand bodies were deposited in the sub-aqueous distributary channels and mouth bars in the delta front and sand bars in the shallow lake. The fine studies of microfacies lay a foundation for the speculation of the favourable facies belts, the potential tapping of remaining oil in the main layers and the future exploration and development of the oil field.