The red beds of the Buntsandstein (Early Triassic) in the Campine Basin (NE Belgium) display porosities between 5.3–20.2% (average 13.7%) and permeabilities varying between 0.02–296.4 mD (average 38.7 mD). Knowledge of their reservoir controlling properties, which today are missing, is important in view of potential geological storage of CO2 or natural gas and geothermal reservoir potential within these sandstones. Therefore the effects of diagenesis were assessed based on petrography, stable isotope analyses, fluid inclusion microthermometry, X-ray diffraction, electron microprobe and porosity-permeability core analyses. These sandstones were deposited by a dryland river system, in a warm, mostly arid climate with episodic rainfall and high evaporation rates. During wetter periods especially feldspars were dissolved. Strong evaporation during dry periods led to reprecipitation of the dissolved species as K-feldspar and quartz overgrowths, smectite and calcite/dolomite. Sediment reworking resulted in framework grains becoming clay coated. The clay coats are better developed in finer than in coarser grained sediments. The original smectite composing the rims converted to illite during burial. The tangential orientation of the clay platelets in the rims led to illite-mica-induced dissolution of quartz during burial/compaction, which is manifested as bedding parallel dissolution seams that are filled with clays and micas, especially in the fine-grained sandstone/siltstone/claystone. These constitute important barriers to the vertical flow within the reservoir. The released silica did not really affect the red sandstones but was exported (often on mm to cm scale) to nearby bleached horizons, where nucleation inhibiting clay rims are less well developed. The red colour of the sandstones arises from the presence of small amounts of Fe-oxides in the inherited clay rims. Migration of fluids enriched in organic acids, expelled from underlying Carboniferous coal-bearing strata, resulted in local bleaching of coarser grained horizons. In the finer grained sediments, the red colour was mostly preserved, which suggests that the reductive capacity of the fluid was limited.