The Dunhua Basin is a collective of Cretaceous-Paleogene Xinkailing Basin, Dashanzuizi-Jingbohu Basin, and Neogene-Quaternary Dunhua Volcanic Basin Formation of the Dunhua Basin was controlled strictly by the two parallel graben faults in the Dunmi Faults Zone. The Dunmi Faults Zone was a series of graben faults in the volcanic orogeny that formed by the westward subduction and compression of the Yizuonaiqi plate during Jurassic-Cretaceous. During Neogene-Quaternary the mantle thermal plume beneath Changbaishan and the westward subduction of the Pacific Ocean made the composite but non-integrity graben deep faults zone, composing the Dunhua Basin. It shows, from a geological survey work, that there exists a proper environment for producing coal and oil in Dashanzuizi-Jingbohu Basin. And it did prove up a principium reserve of five hundred eight-two million tons, perspective reserve of one billion tons of coal and one hundred twenty-four million tons of natural gas and oil. The basalts in Dunhua Basin were formed multiply and distributed on a wide area, which brought up the many beautiful scenery and resources such as building material, casting and rock-cotton and diatomite.