The Tongue River Member of the Paleocene Fort Union Formation is an important coal-bearing sedimentary unit in the Powder River Basin of Wyoming and Montana. We studied the depositional environments of a portion of this member at three sites 20 km apart in the southeastern part of the basin. Six lithofacies are recognized that we assign to five depositional facies categorized as either channel or interchannel-wetlands environments. (1) Type A sandstone is cross stratified and occurs as lenticular bodies with concave-upward basal surfaces; these bodies are assigned to the channel facies interpreted to be the product of low-sinuosity streams. (2) Type B sandstone occurs in parallel-bedded units containing mudrock partings and fossil plant debris; these units constitute the levee facies. (3) Type C sandstone typically lacks internal structure and occurs as tabular bodies separating finer grained deposits; these bodies represent the crevasse-splay facies. (4) Gray mudrock is generally nonlaminated and contains ironstone concretions; these deposits constitute the floodplain facies. (5) Carbonaceous shale and coal are assigned to the swamp facies. We recognize two styles of stream deposition in our study area. Laterally continuous complexes of single and multistoried channel bodies occur at our middle study site and we interpret these to be the deposits of sandy braided stream systems. In the two adjacent study sites, single and multistoried channel bodies are isolated in a matrix of finer-grained interchannel sediment suggesting deposition by anastomosed streams. A depositional model for our study area contains northwest-trending braided stream systems. Avulsions of these systems created anastomosed streams that flowed into adjacent interchannel areas. We propose that during late Paleocene a broad alluvial plain existed on the southeastern flank of the Powder River Basin. The braided streams that crossed this surface were tributaries to a northward-flowing, basin-axis trunk stream that existed to the west. ?? 1990.