The Gaoyou Sag of Subei Basin is one of the key oil and gas exploring and developing areas in Jiangsu Oilfield, and is a typical dustpan shaped subsidence lacustrine basin with a fault as its south boundary and a slope to the north. The Dainan Formation in Gaoyou sag is 2000 m thick and comprises mainly of fluvial-lacustrine sandstone and mudstone, and is divided into 2 Members and Member 1 is of the lower part. Depositional filling process of Dainan Formation was analyzed and sedimentary facies maps were drawn. When the Member 1 was deposited, the tectonic activity of the basin was comparatively stronger and altitude difference between the boundary and the sag was comparatively bigger. Comparatively, the water was deeper and the scope of water was smaller. Consequently, proximal subaqueous fan, sublacustrine fan and delta facies were developed from south to north respectively. When the Member 2 of Dainan Formation was deposited, the tectonic activity was comparatively weaker and altitude difference between the boundary and the sag became smaller. The water was shallower and the sag was entirely covered by water. Consequently, fan delta, sublacustrine fan and delta facies were developed from south to north respectively. The maps of sedimentary facies of Dainan Formation were drawn based on the thickness isoline maps of sandstone and other data. The sedimentary facies were developed in specific places in plane and shows differences and hereditability in vertical evolution. The syndepositional faults, either as boundary or within Gaoyou Sag, were key factors in controlling the distribution of sedimentary facies and sandbodies. The development of sedimentary facies controls the development and distribution of oil and gas reservoirs, especially subtle ones. The main subtle traps of Dainan Formation in Gaoyou Sag are stratigraphic overlapping, fault-lithologic, upward thinout and lenticular ones. The favored oilbearing facies include sublacustine fan, delta front, fan delta front and the central part of subaqueous fan facies. With the data mentioned above plus analysis on the petroleum geologic conditions, several favorable subtle trap exploring areas are put forward.