Abstract: This paper probed into the formation conditions and the possible accumulation model of permafrost natural gas hydrate in China, based on such hydrate forming key elements as temperature, air source, water source etc. It mainly analyzed petroleum geology and temperature of Qiangtang Basin, Qilian mountainous region and Mohe Basin, and further summarized natural gas hydrate forming conditions in these regions. The tectonic conditions, air source and temperature of Muli region in Qilian Mountain is relatively better as a whole, which is regarded as favorable for exploration and research of permafrost gas hydrate in China at present. Through analyzing gas hydrate source, petroleum geology, tectonic evolution and other characteristics, it showed that natural gas hydrate formation in Muli region is controlled by fault development. Under the action of the fault, lower thermogenic gas re-migrated to gas hydrate stability zone, forming gas hydrate. Besides conventional gas reservoir can also form hydrate reservoir, based on later tectonic uplift to gas hydrate stability zone