Cambrian strata spread widely and expose continuously in the West of Shandong Province, and thrombolite develop in the Zhangxia formation and Chaomidian formation. The result of field observations and microscopic identifications shows that thrombolite of this area is mainly composed of Epiphyton bonding and capturing carbonate particles, followed by Girvanella, Renalcis, Actinophycus. According to the size of branches, existence of cell-like segments, and degree of crystallization, Epiphyton can be divided into five types, micrite bifurcating rodlike branches(75～80μm), micrite segmented branches (～80μm), micrite bifurcating fine branches (40～60μm), crystallite tubular branches (<40μm) and sparry bifurcating rodlike branches (～75μm). And corresponding thallus can be divided into four types, micrite bush shaped, single chambered, cluster chambered, sparry bush shaped. Under the microscope, the clot is a mass which is formed by calcified bodies of cyanobacteria such as Epiphyton and bonding carbonate particles. According to its morphology, it is divided into the clotted, meshed and dendritic. In summary, all the above reveal that formation of thrombolite include four stages: capturing and bonding of cyanobacteria, calcification of cyanobacteria, carbonate deposition in situ, and postdeposition.