The Denchai gem sapphire deposits in Phrae Province, northern Thailand are closely associated with late Cenozoic alkaline basaltic rocks. The sapphires occur in alluvial placer deposits in palaeo-channels at shallow depths. Electron microprobe analysis of minor and trace element contents (Fe, Ti, Cr, Ga and V) of the sapphires indicate the following oxide abundances: Fe2O3 (0.32–1.98 wt.%), TiO2 (0.01–0.23 wt.%), Cr2O3 (<0.01 wt.%), Ga2O3 (0.01–0.03 wt.%) and V2O5 (<0.03 wt.%). Optical studies of sapphires revealed three types of primary fluid/melt inclusions. CO2-rich inclusions (Type I) contain three phases (LH2O + LCO2 + V) with the vapour phase comprising <10–15 vol.%. The presence of CO2 was confirmed by microthermometry and laser Raman analysis. Polyphase inclusions (Type II) (vapour + liquid + solid) contain a fluid bubble (20–30 vol.%), an aqueous phase (10–15 vol.%) and several solid phases. Silicate-melt inclusions (Type III) comprise vapour bubbles, silicate glass and solid phases. Proton-induced X-ray emission (PIXE) analysis revealed high concentrations of K (~4 wt.%) as well as Ca (~0.5 wt.%), Ti (~1 wt.%), Fe (~2 wt.%), Mn (~0.1 wt.%), V (<0.03 wt.%), Rb (~70 ppm) and Zr (~200 ppm) in the silicate glass. The Ga2O3 abundances and Cr2O3/Ga2O3 values (<1) of the sapphires favour their formation by magmatic processes. The presence of CO2-rich fluids and high K concentrations in the silicate melt inclusions link the origin of the Denchai gem sapphires to CO2-rich alkaline magmatism.