This paper presents the sedimentary facies and formation of the Qiantangjiang and Taihu incised valleys, and the characteristics of shallow gas reservoir distribution, based on a large number of data of drilling, static sounding and chemical analysis obtained from the present Hangzhou Bay coastal plain. The incised valleys were formed during the last glacial maximum and were subsequently filled with fluvial facies during the post-glacial period. All commercial gases are stored in the flood plain sand lenses of the incised valleys.