Abstract: The presence of economical clay formations in the terrestrial Neogene deposits of the KaraburunPeninsula is well known. Clay formations occur in the Early Miocene Salman formation. The formationwhich indicates the beginning of the Neogene terrestrial sedimentation in the Karaburun Peninsula, deposited in a fan delta environment. It starts with disorganised boulderstone at base and grades in conglomerate through upward. The sublacustrine part of the fan-delta sequence represented by siltstoneand conglomerate alternation overlies the subaerial fan-delta sequence including coarse-graineddeposits. The sublacustrine fan-delta deposits are made up of channel-fill, debris-flow and overbanklithofacies. Lacustrine backshore sequence represented by massive siltstone levels with lignite levelsand calcareous interlayers deposited over the sublacustrine fan-delta deposits. The Salman formationis covered by the Early Miocene Yaylaköy volcanites comprising the product of calc-alkaline volcanism.The Yaylaköy volcanites contain andesite-basaltic andesite lava flows reflecting two different stages ofsettling and pyroclastic deposits including fine ash-lapille tuff alternation which seperate these flows. Thecommercially clay formations developed on overbank lithofacies of the fan-delta deposits. It is expectedthat the main factor of controlling the illite-kaolinite rich clay formations are related to geochemical andmineralogical characteristics of the source rocks.