Abstract: Steam assisted gravity drainage (SAGD) is an effective technology to develop thick super heavy oil reservoirs, but there are serious steam overlay, great heat loss, low oil/steam ratio and other problems in the middle and late stages of the development, which impact the development effect. In this paper, the influences of flue gas on in-place oil properties and the heat loss of steam in the overlying strata, change laws of steam chamber and production characteristics after the injection of steam with flue gas were experimentally studied in the laboratory by using PVT analyzer and proportional physical simulation system. It is indicated that the injected flue gas can effectively reduce the in-place oil viscosity, improve the flow capacity of crude oil and increase the volume coefficient and the elastic energy. Compared with conventional SAGD, the flue gas-assisted SAGD speeds up the transverse expansion of steam chamber and slows down the longitudinal expansion, so as to effectively inhibit the phenomenon of steam overlay. The flue gas injected together with steam accumulates above the steam chamber to form a heat insulation layer, which reduces the heat loss of steam in the overlying cover, so as to improve the heat utilization efficiency. Steam injection with flue gas in the process of conventional SAGD can reduce the amount of steam injection to a certain degree, increase the oil/steam ratio and improve the development effect.