Abstract: Using CO₂ as the cushion gas in underground gas storage is cost-effective. It is strategically and socially significant for effective geological sequestration of carbon. Based on existing literatures, the status of research on CO₂ as cushion gas is investigated in respect of physical properties of CO₂ and natural gas, mechanism of mixing CO₂ as cushion gas with working gas, permeation-diffusion coupling of underground gas storage using CO₂ as the cushion gas, and the optimal operation control mode. Moreover, the prospect of such research is discussed, indicating the focuses and challenges in future. First, experimental study should be made on interactions among CO₂, formation water and reservoir rock, changes in gas mixing zone and features of gas-gas driving/permeation. Second, a 3D gas-gas driving & gas-fluid flowing model of adsorption, diffusion and convection considering the mixing of CO₂ with natural gas should be established, as a supplement and accelerator to the world-popular commercial simulation software so as to make the software more adaptive to the operation of gas storages using CO₂ as the cushion gas. Third, the capacity variation of gas storages should be identified in multiple injection-production processes, so as to ensure the safety and efficiency of the gas storages under optimized control.