In this paper, with the basic principle and method of sequence stratigraphy, the discrimination and contrast of Cambrian sequence in the Upper Yangtze region were made, and the plane and spatial distribution of sedimentary facies were studied within three-order sequences in Early Cambrian. Taking the black shale of Niutitang Formation in Lower Cambrian as an example, the shale reservoir was evaluated, and the result indicated that the sequence stratigraphy of outcrops was evaluable in the initial exploration of shale gas.