System tract, a basic unit of Ⅲ grade sequence, is a combination of the same term depositional systems controlled by water level changes (lacustrine level or sea level). Petroleum tends to being accumulated in the depositional sand bodies of different system tracts. The type and distribution of lithologic pools could be predicted by characterization of system tracts and analysis of depositional systems. In southwestern Qaidam basin, the characterization of system tracts shows that there exist developed transgressive system tract (TST) and various types of reservoirs such as sand body of deltaic front, lacustrine beach and dam as well as local turbidite of semideep lake. Based on synthetically geologic and seismic analyses, using digital seismic processing techniques (Jason＇s reservoir inversion, etc.), the sand body distribution could be described, hence predicting that in southwestern Qaidam basin mainly developed the lithologic pools of SB, TU, DT and SS types.