The fault system of Liaodong Bay developed extensively under the control of the Tanlu Fault. The fault system can be grouped into strike-slip faults of grade I, trunk faults of grade II and branch faults (induced faults) of grade III respectively based on its developmental scale. The faults of grade I and II were deep, early and large while the faults of grade III were shallow, late and small. The formation, evolution and distribution features played a significant role in controlling the migration of oil and gas in both horizontal and vertical directions. The fluid transfer in the fault system occurred in the process of faulting. The strike-slip and trunk faults moved actively forming predominant pathways for oil and gas migration. The branch faults, with weak activity, generally controlled the development of traps and were beneficial for the accumulation and preservation of oil and gas. The faults of grade I and II formed the major migration pathways for oil and gas, but their fault activity rates appeared to vary along their strikes. The zones with a relatively low fault activity rate might be favorable for oil and gas accumulation. When the activities of strike-slip, trunk, and branch faults came to a halt, the fault seal behavior had a vitally important effect on the accumulation of oil and gas. The controlling role of the fault over fluid distribution was further analyzed by calculating the fault activity quantitatively.