According to the analysis of geological and geophysical data, there are six structural systems of different period: Latitudial structural system, Neocathay-sian structural system, Nanhai system,Meridional system, N-W structural zone and Arc-type structural system in the South China Sea. The formation of the South China sea was mainly controlled by the Neoca-thaysian system and Nanhai system. The South China Sea expanded for the first time due to the activation of the Neocathaysian system, thus resulting in the N-E tectonic outline of the old South China Sea during the Cretaceous-Early Tertiary. From the Late Oligocene to Early Miocene, the South China Sea expanded for the second time due to the stress field changes and activation of the Nanhai system, thus resulting in a series of faults, uplifts and depressions. From the point of view of geomechanics, the stress effects in this region can be divided into three stages: 1. Early Yenshanian (the Triassic to the Early Cretaceous) stage was mainly NW-SE trending compression; 2. Late Yenshanian (the Late Cretaceous to the Early Oligocene) stage was mainly NW-SE trending tension; 3. Himalayan (the Late Oligocene to the Early Miocene) stage was characterized by nearly SN trending tensile stress. This suggests that the changes ofregional stress of the South China Sea were caused by the variation of the earth's rotative velocity. Sediments, generally thicker than 2000 m and the thickest over 10000 m, aremainly terrigenous and shallow-sea facies. Up to now, thirty five sedimentary basins have been found in the South China Sea. It is obvious that they are controlled by the structural systems (particularly the Nanhai system). Inthe light of stress character, these basins can be grouped into four types:tensile, tenso-shearing, compressive and compresso-shearing basins among which tensile and tenso-shearing basins of the Nanhai system and compressive basins of the Neocathaysian system are the most promising in oil and gas potential.