This research studies a subterraneous section of the Dalan Formation in well X in one of the Persian Gulf gas field. The Dalan Formation, Permian in age, in folded Zagros region and the Persian Gulf contains giant gas resources. The lower boundary of the Dalan Formation is continuous and gradual, along with the siliciclastics of Faraghun Formation. The Upper Dalan is overlain by the Kangan Formation. The boundary of these Formations is the Permo-Triassic erosional surface. Diagenesis processes that affected the Dalan Formation include Cementation, Bioturbation, Micritization, Geopetal fabric, Dissolution, Compaction, Neomorphism, Pyritization, Ironzation and Dolomitization. Dolomitization, dissolution and cementation are the predominant diagenetic processes in this Formation. Marine, Meteoric and Burial diagenetic environments affected the Dalan Formation. According to sedimentary structure, texture and biota content 16 microfacies are determined for the Dalan Formation. These microfacies are presented in 3 facies belts, including Tidal flats, Lagoon and Carbonate shoal. The sedimentary environment of the Dalan Formation is introduced as a homoclinal carbonate ramp deposition. Dissolution along with microfractures had a positive effect on the improvement of reservoir quality.