Summary Oil recovery in heterogeneous carbonate reservoirs is typically inefficient because of the presence of high-permeability fracture networks and unfavorable capillary forces within the oil-wet matrix. Foam, as a mobility-control agent, has been proposed to mitigate the effect of reservoir heterogeneity by diverting injected fluids from the high-permeability fractured zones into the low-permeability unswept rock matrix, hence improving the sweep efficiency. This paper describes the use of a low-interfacial-tension (low-IFT) foaming formulation to improve oil recovery in highly heterogeneous/fractured oil-wet carbonate reservoirs. This formulation provides both mobility control and oil/water IFT reduction to overcome the unfavorable capillary forces preventing invading fluids from entering an oil-filled matrix. Thus, as expected, the combination of mobility control and low-IFT significantly improves oil recovery compared with either foam or surfactant flooding. A three-component surfactant formulation was tailored using phase-behavior tests with seawater and crude oil from a targeted reservoir. The optimized formulation simultaneously can generate IFT of 10−2 mN/m and strong foam in porous media when oil is present. Foam flooding was investigated in a representative fractured core system, in which a well-defined fracture was created by splitting the core lengthwise and precisely controlling the fracture aperture by applying a specific confining pressure. The foam-flooding experiments reveal that, in an oil-wet fractured Edward Brown dolomite, our low-IFT foaming formulation recovers approximately 72% original oil in place (OOIP), whereas waterflooding recovers only less than 2% OOIP; moreover, the residual oil saturation in the matrix was lowered by more than 20% compared with a foaming formulation lacking a low-IFT property. Coreflood results also indicate that the low-IFT foam diverts primarily the aqueous surfactant solution into the matrix because of (1) mobility reduction caused by foam in the fracture, (2) significantly lower capillary entry pressure for surfactant solution compared with gas, and (3) increasing the water relative permeability in the matrix by decreasing the residual oil. The selective diversion effect of this low-IFT foaming system effectively recovers the trapped oil, which cannot be recovered with single surfactant or high-IFT foaming formulations applied to highly heterogeneous or fractured reservoirs.