Abstract: One of original reasons for casing failure is the complicated crustal stress distribution. The study of the primary reason for casing failure in different areas is necessary for casing failure precaution at designing stage. The 3-D crustal stress model for Zhaoao oilfield was built up on base of the finite element numerical simulation. The crustal stress spatial distribution was obtained which is close to real stress field. The relationship between crustal stress distribution and casing failure was built up, and the result shows that the wells with casing failure occurred are located on the bridge of nose-like structure and they are also on the ‘steps’ from up side down. This provides precaution measures of casing failure in Zhaoao Oil Field with theoretical support.