Many mud diapirs have been identified in the southern Okinawa Trough from a seismic survey using R/V KEXUE I in 2001. The movement and accumulation of free gas related to mud diapirs are discussed in detail by an analysis of fluid potential which is based upon velocity data. It can be found that free gas moves from the higher fluid potential strata to the lower ones and the gas hydrate comes into being during free gas movement meeting the proper criteria of temperature and pressure. In fact, gas hydrates have been found in the upper layers above the mud diapirs and in host rocks exhibiting other geophysical characteristics. As the result of the formation of the gas hydrate, the free gas bearing strata are enclosed by the gas hydrate bearing strata. Due to the high pressure anomalies of the free gas bearing strata the fluid potential increases noticeably. It can then be concluded that the high fluid potential anomaly on the low fluid potential background may be caused by the presence of the free gas below the gas hydrate bearing strata.