Abstract: The Kaiping Sag is located in the western part of Zhu II Depression, Pearl River Mouth Basin in the ocean-continent transition zone of the northern continental margin of the South China Sea. The tectonic characteristics of Kaiping Sag are very complex while the degree of research is relatively low. Therefore, we studied the evolution process of rifting in this area to reveal the conditions of sedimentation and hydrocarbon source development. Based on the high-resolution 3D seismic data of the Kaiping Sag, the geo-structure and fault system in this area were dissected, the distribution and development characteristics of the Paleogene faults were expounded systematically, the activity characteristics of main faults were quantitatively discussed, the evolution of fault system and the migration of sedimentary center in the Paleogene rift period were clarified, and the balanced profile of the rifting evolution of Kaiping Sag since the Paleogene was reconstructed. Results show that the Kaiping Sag shows a tectonic pattern of “north faulting and south surpassing”. Two groups of main fault sets, NE-NEE and NWW, are developed during the rifting period, which controlled the tectonic deformation and sedimentary filling of the sag, and its depression-controlling faults are characteristic of detachment and extension. The activity intensity of the main faults in Kaiping Sag gradually increased in the Wenchang Stage of the Early Eocene, and weakened-ceased in the post-Enping Stage of the Late Eocene. The sedimentary center migrated many times during the sedimentary period of Wenchang-Enping Formations in the Paleogene. The distribution of the fracture system and balance profile analysis suggest that Kaiping Sag is a Cenozoic extensional faulted basin formed based on the late Mesozoic tectonic deformation in the northern continental margin of the South China Sea, and its evolution can be divided into three stages: the early-Wenchang fault extension stage, the late-Wenchang detachment extension stage, and the Enping Formation underplating-depression stage. The tectonic evolution of Kaiping Sag is controlled by the dynamic mechanism of “Pre-existing tectonic constraints, detachment and thinning domination, and magmatism involvement” in the Pearl River Mouth Basin.