The Taihu thrust system in eastern Hunan Province was defined in this paper on the basis of geological and borehole observations. The NE-trending thrust system is composed from northwest to southeast of such structural elements as frontal thrust fault (Luosiqiao fault, frontal belt of nappe and upper decollement structure, low ramp (Tiepuao-Longfengqiao hidden fault) and back belt of nappe, back-thrusting fault (Zhongwan fault, and rear syncline. Based on these geological characteristics and using structural correlation analysis, the authors put forward the formation mechanisms of the Taihu thrust system, the Yajiangqiao domal uplift and the Yajiangqiao pluton as follows: under the NW(W)- trending compressive stress during the Indosinian movement, deep and shallow detachment and thrusting took place along the low ramp, resulting in the formation of the Taihu thrust system.