The clastic sequence of the Ergiliin Zoo Formation stretches along the Mongolian–Chinese border in the southern Gobi Desert, Mongolia. Its members (Sevkhuul, Ergil) exposed in the Erdene Sum region are well known for their vertebrate remains of Late Eocene and Oligocene age. Based upon field work, the continental red beds were subdivided into four units described as (I) prodelta/mud-sand flat, (II) delta front, (III) delta plain and (IV) calcretes. All sub-environments are in a fluvial–lacustrine setting. Electronmicroprobe analysis, in addition to conventional thin-section examination, was applied to shed some light on the complex mineral association made up of light minerals (quartz, plagioclase, ternary feldspar, orthoclase, smectite, illite, rare palygorskite), heavy minerals (almandine–pyrope solid solution series, zoisite–epidote s.s.s.) and abundant goethite and carbonate minerals (calcite, dolomite). Igneous rocks being exposed in the source area have contributed to the formation of carbonate minerals and Mg-bearing sheet silicates during diagenesis. Higher up on the delta plain transitional between distal alluvial and deltaic deposits, fluids emerged from the distal alluvial–fluvial deposits and formed calcareous duricrusts. Drawing conclusions from the rock colour, the mineral assemblage and the palaeoecological data, the climatic conditions may be described as alternating wet and dry seasons, closely resembling those conditions of a modern savannah.