The reservoirs of permian in Dongpu depression are characterized by lower porosity and permeability. The complexity of geological conditions restricts the research of reservoirs. Combining the analysis of sedimentary characteristics and diagenesis characteristics, the controlling factors of physical properties of Permian reservoirs were discussed．It is indicated that the sand bodies of channel, distributary and underwater distributary channel are favorable for reservoir formation because of good porosity. Diagenesis is the most critical factor affecting the reservoir porosity evolution. On the one hand, compaction and cementation are the main causes for reservoir tightness. On the other hand, dissolution is mainly shown as the corrosion of feldspars and carbonate cement, and in turn, makes the physical property of reservoirs better. Based on the porosity and permeability data of 219 samples from 26 cored wells, production test data and mercury injection data, the lower property limits of effective reservoirs were determined by oil production test method, empirical statistic method and mercury injection curve method. The results show that the lower limit of porosity is 4.8% and the lower limit of permeability is 0.04 mD.