Abstract: To mitigate the sufferings of the local residents from water-shortage for their daily life in some villages and towns of central Yunnan red beds areas, China Geological Survey has carried out a project on groundwater investigation and utilization. Based on the survey data on this project and the water supply demonstration project, meanwhile, combined the results of our predecessors has been, this paper mainly discussed the distribution of different types of groundwater, the occurrence features, the types of drill for water and a variety of water supply mode which combined the local settlements characteristics in the demonstration area.