Tengchong, one of the largest geothermal areasin China, covers an area of 6000 km2 and is noted for a great number of hot springs, As a result of frequent geothermal activities, all the rocks, mainly late Tertiary arkose and arkosic conglomerate composed of granitic gravels, granites basalts and andesites, have been altered intensely. The hydrothermal altered, mineral assemblages include (1)siliceous minerals, dominantly quartz and opal; (2)sul- fates, mainly alunite; (3)kaolin minerals, chiefly kaolinite with small amoun- is of halloysite and dickite; (4) montmorillonite and chlorite; (5)interstra- tified minerals of illite/montmorillonite (I/M);(6)phosphates such as goyazite and woodhouseite. The species and contents of the principal altered minerals are control- led by properties of the original rocks, Generally speaking, arkose and arkosic conglomerate and granites have been altered into kaolinite, and basalts into illite and smectite together with a little interstratified minerals of I/M, Silicified minerals are often developed in andesites, There occurs. the sequence of argillization from andesite-granites-basalts-arkose and arko- sic conglomerates in which kaolinization is developed widely, Different altered minerals are distributed selectively in different grain diameters. Studies show that kaolinites are enriched in the grain size of <2um, interstratified minerals of I/M in the grain size of glum, and sericites, quartz and opal gathered together in the coarse grains. Studies show that arkose and arkosic conglomerates are responsible for the formation of kaolin minerals in the process of alteration, The kaolin deposit is formed through geothermal alteration of these rocks because they are extensively distributed in the geothermal area.