Carbon dioxide (CO2) is considered to be one of the greenhouse gases that may most contributes to global warming on earth. Disposal of CO 2 from stationary sources into subsurface has been suggested as a possible means for reducing emissions of greenhouse gases into the atmosphere. However, much remains to be done in the issues regarding the safety and reliability of CO2 sequestration. In this study, we have developed a simulation code by using the mathematical model of two-phase flow in porous media to analyze the flow dynamics in the subsurface. The effect of CO 2 dissolution in water on the injection behavior is taken into account by using Henry's law. The CO2 solubility in water has been shown to be an important factor which affects the pressure distribution and the migration of the CO2 front. It has been demonstrated that the simulation code developed in this study may be useful to provide fundamental knowledge required for design of CO2 injection.