The partially equivalent Lakota and Cloverly Formations comprise the basal Cretaceous strata in outcrop exposures along the eastern and western margins, respectively, of the Powder River basin. They unconformably blanket a subaerial erosional surface that developed during Early Cretaceous time. Paleocurrent analysis of outcrops surrounding the Powder River basin, together with petrographic data, demonstrates that the formations had different source areas: sediments of the Cloverly were derived from the Sevier orogenic belt, whereas those of the Lakota were derived primarily from areas east and southeast of the present-day Powder River basin. The formations also display different facies: conglomeratic sandstones of the Cloverly appear to have been deposited by braided streams, whereas the well-sorted, fine to medium-grained sandstones of the Lakota were deposited by meandering fluvial systems. Although confirming biostratigraphic data are lacking, stratigraphic relationships strongly suggest that initiation of Lakota deposition preceded that of the Cloverly. The upper parts of both formations include red, green, and beige mudstones and appear to be correlative. They record a period of slow sedimentation immediately prior to transgression of the sea. They also record a change in paleoslope over much of the Powder River basin, the original northeastward-sloping surface having been tilted northwestward in response to subsidence within the foreland basin. Cloverly deposition was terminated by rapid transgression of the Thermopolis sea. Basal beds of the Thermopolis interfinger southeastward with deltaic deposits at the top of the Lakota. Lakota deposition was terminated somewhat later, the youngest Lakota strata being overlain by the Fuson tongue of the Thermopolis.

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