Yellow Sea area, located between the margin of China's mainland and the oceanic crust of the Western Pacific Ocean, has transitional crustal structure. Being controlled by the surrounding tectonics, the basement in North Yellow Sea basin is of the North China landmass, while that in South Yellow Sea basin is of the Lower Yangtze landmass, as a result, the crustal structure is very complicated. Based on the strike-slip movement of Tancheng-Lujiang fracture, massive northward overthrusting of North Jiangsu plate along the fracture and the cut-in of Shandong-Jiangsu ultra-high pressured metamorphic zone, and in combination with stratigraphic paleontologic study and dating of rock to be 220~230 Ma, it is believed that North China landmass would have collided with the Lower Yangtze landmass in early Triassic, leading to the formation of Sino-Korean orogenic belt traversing the middle of Yellow Sea. The NEE trending Sino-Korean orogenic belt, with a wedge shape being wide in the west and narrow in the east, is composed of Sujiao orogenic zone, Qianliyan uplift zone and Linjinjiang orogenic zone. Since Middle Jurassic, the re-uplifting of the orogenic belt resulted in the rifting and subsiding of the North and South Yellow Sea basins and deposition of Upper Jurassic and Cretaceous strata. There are two petroleum systems in North Yellow Sea basin. The first one, with the Upper Jurassic deep or semi-deep lacustrine sediment to be the major source rocks and the Upper Jurassic and Lower Cretaceous sandstones and sandy conglomerate to be the good reservoirs, has been verified by well producing wells,such as the.606 well. While the second one, with the Tertiary paludal coal measures to be the source rocks and the Tertiary siliceous clastic rocks to be the reservoirs, has gas potentials. South Yellow Sea basin can further be subdivided into northern depression, middle uplift zone and southern depression. In the southern and northern depressions, Lower Tertiary Funing and Dainan Formations are the major source rocks, and the Taizhou and Pukou formations are the possible source rocks. The Mesozoic and Lower Tertiary are absent in the middle uplift zone, since it has long been uplifting. Exploration of the Paleozoic should be strengthened in the middle uplift zone, where prolific gas reservoirs are expected to be discovered in Silurian-Devonian.