ABSTRACTA colour Landsat Thematic Mapper image was used to identify and to map on a regional scale alluvial facies in the lower Eocene Willwood Formation. Each facies covers a distinct geographical area of several hundred square kilometres in the Bighorn Basin of Wyoming, USA. Comparison of the image with laboratory spectra from Willwood Formation rocks and field exposures shows that the image provides information regarding the colour of mudstones, their relative abundances, and the relative abundance of sandstones. Facies were further characterized from field study and published descriptions on the basis of sandbody geometry, the types of nodules present in the mudstones, and the abundance and geometry of carbonaceous mudstones. This information helps to interpret the fluvial environments represented and types of alluvial palaeosols found in the Willwood Formation.Four facies have been distinguished. The first facies is dominated by sheet sandbodies associated with immature palaeosols. The sheets mark the locations of major channels, which tend to occur in topographic lows. The second facies is characterized by more mature, moderately drained soils that required relatively lengthy periods of non‐deposition. Facies three and four dominantly consist of drab mudstones and abundant carbonaceous units, both formed in poorly drained areas. Although minor red mudstones demonstrate that drainage conditions periodically improved in facies three, facies four underwent prolonged saturation.The geographical facies distribution suggests that east‐west faults previously mapped in the Bighorn Mountains, extend westward into the Bighorn Basin and were active during early Eocene time. The lithological heterogeneity of the Willwood Formation rocks is attributed to warping associated with movement along these basement‐controlled faults. Fault activity created topographic gradients which influenced the position of major channel systems and helped produce variable drainage conditions that affected Eocene soil development.