Abstract: The thermal neutron count and capture gammaray spectroscopy before and after gadolinium seeping into sandstone and limestone formation are simulated by Monte Carlo Method, and the determination method of oil saturation is studied by using the thermal neutron count rate ratio and the n(Gd)/n(H) of capture gamma spectrum before and after gadolinium seeping. In addition, the relations of ratio with influence factors such as porosity, salinity of gadolinium seeping, saturation and lithology are given. 