In this work the composition forming nanostructured gel, which does not change phase permeability of oil, easily penetrating into water-saturated depth of the formation in watered wells, effectively closing the drainage channels, is established, the possibilities of its rapid heating up to formation temperature, gel formation within a certain time in contact with water depending on the concentration of the selected composition and with its use of involvement in the development of residual oil reserves, which are in watered wells, are investigated at injection of this composition into the well. As an optimal variant of well isolation in terrigenous reservoirs of oil fields it is suggested to use nanocomposite on the basis of silicate gel (with the content of liquid glass 4 % (modulus 3.1), 0.6 % of hydrochloric acid and 0.063 % of metal nanoparticles). The mechanism of selective isolation of water flow in production wells is based on the fact that when the composition is injected into the production well, part of its volume gets into the oil-saturated layer, and the rest – into the water-saturated layer. The composition is distributed in proportion to the permeability of the layers. In the process of well development the composition in the oil-saturated layer is removed, and in the water-saturated layer it retains its isolating properties. The greater the volume of injected fluid, the greater the isolation factor and pressure gradient. The isolation factor is directly proportional to the volume injected. Gel formed in the water-saturated layer corresponding to the volume of the injected composition reduces the phase conductivity on water at least 30 times. Practically does not change the phase conductivity by oil. On the basis of the calculation model including physical and chemical characteristics of selective isolation process taking into account real field conditions, the influence of possibility to isolate bottomhole zone of wells by gel on technological indicators of its operation was estimated. Thus, when putting into operation a well after isolation by water, the production of which was flooded with water, in the initial moments there was a sharp increase in oil flow rate (2–3 times), and at the subsequent stage – a slight decrease in the rate, compared to the flow rate before isolation, the effective time of development or flushing was about 150 days.