Abstract: The Outangwan gold deposit, belonging to weathered-type, is a typical laterite gold deposit in Southern Hubei Province. The Quaternary Pleistocene red gravel loam is the main ore-containing horizon. The occurrence of ore body is gentle, with stable thickness. The gold in ore is in free state. The ore-controlling factors include favorable basement rock, structure and hydrothermal activity, as well as the favorable climate and geomorphology for the formation of red clay. The prospecting indicators are proposed on the basis of geological background and characteristics of orebodies.