Phylloid-algal mounds form heterogeneous hydrocarbon reservoirs in the southeastern portion (Blanding sub-basin) of the Paradox Basin. Well-studied Lower Ismay mounds exposed along walls of the San Juan River gorge in the vicinity of Eight Foot Rapids, the west limb of the Raplee Anticline, and at the classic Honaker Trail locality (southwestern Paradox Basin) have often been cited as outcrop analogs of productive subsurface mounds. Until now, however, there has not been a complete description of the distribution, size, and spacing of outcropping algal mounds at the classic Eight Foot Rapids locality. The Lower Ismay sequence was analyzed in the context of a build-and-fill model of deposition. There are three facies associations within the sequence: 1) a basal lowstand to middle highstand pre-mound facies association, 2) a late highstand to middle falling stage phylloid algal-dominated relief-building facies association, and 3) a late falling stage, post-mound relief-filling facies association. Above the basal maximum flooding surface (Gothic Shale), the facies succession displays a distinct shallowing upward trend through the Lower Ismay sequence. Mound dimensions and facies stacking patterns permit evaluation of two depositional models. The first is a traditional, moderate- to low-energy model of vertical and radial mound accumulation of phylloid algal plates. The second is a high-energy, tidally influenced model of accumulation wherein mounds become hydrodynamically elongate. Outcrop data indicate that algal-dominated buildups are domal in shape with no preferred axis of elongation. These patterns do not support a hydrodynamic accumulation of loose algal plate fragments. The absence of in-situ algal thalli in all but the upper few tens of centimeters of the mounds, however, argues against a purely biological/ecological origin of mounds. A down-stepping ramp model is proposed wherein a muddy algal facies was deposited at the base of the mounds in the low energy of the outer ramp, followed by a grain-rich algal core in the mid-ramp environment. Mounds tops accumulated in an algal bafflestone facies in the inner ramp setting. Restriction of energy due to basinward algal buildup may have also contributed to deposition of algal bafflestone. Mounds accumulated radially at differential rates and were influenced by these variations in energy. This differential deposition of microfacies and subsequent diagenetic alteration have produced heterogeneities in algal reservoir rock, producing algal mound reservoirs that have a high potential for compartmentalization.