Simulation of naturally fractured reservoirs is one of the most important challenges in the oil and gas industry. Many of oil and gas reservoirs are naturally fractured and these reservoirs contain a significant amount of the world’s oiland gas reserves.These reservoirs rupture due to different natural or artificial causes. The created fractures have a significant influence on multiphase flow behavior in reservoirs. Many of Iranian reservoirs are also fractured reservoirs. Common methods for simulation of fractured reservoirs are dual porosity and dual permeability model. In this study, a mathematical modelwas provided for the simulation of fractured reservoirs and this model was developed on the basis of the dual porosity model. In the dual porosity model, the reservoirs environment was divided into two zones: the fractured zone and the matrix block. The fractured zone had a high permeability and low porosity; however matrix blocks had low permeability and high porosity. Consequently, fluid was stored inside the matrix blocks and flow through fractures and there was no communication between matrix blocks. In this study the dynamic relation between the two parts (matrix zone and fracture zone) was explained by utilizing overall mass balance on the reservoir that resulted to the transfer function witch could be derived experimentally.For the mathematical modeling of these reservoirs mass balance equations in conjunction with Darcy’s law for three components of oil, water and gas, conducted the dual porosity model for these reservoirs. Then, the numerical model of derived equationswas introduced, using IMPES method. For validation of this model, the results from modeling were compared with discrete-fractured model and also were compared with experimental data. The results of dual porosity model showed good agreement with discrete fractured model and also the results were compatible reasonably with experimental data.After the assurance of the accuracy and validity of introduced model, application of this model for water injection in fractured reservoirs was demonstrated and the effect of capillary pressure, matrix permeability, oil viscosity and injection rate on oil recovery performance in fractured reservoirs were studied in order to study sensitivity analysis. The results showed an increase in oil recovery of %3 by doubling the matrix permeability. Oil recovery also was increased by %5 with doubling water injection rate, but the influence of water injection rate would not be considerable by continuing oil production. Study of oil viscosity indicated that, the oil recovery was decreased by increasing the oil viscosity. Study of matrix capillary pressure effect on the amount of oil recovery illustrated that by neglecting the capillary pressure, oil recovery was decreased by %5 which leaded a considerable error in calculating the amount of recoverable oil. From this result it could be concluded that considering matrix capillary pressure in simulating fractured reservoirs was very important. The developed model which had the ability to simulate the three-phase flow of water, gas and oil in two dimensions, would be the basis for development of a general simulation for fractured reservoirs. All known mechanism in the fractured reservoirs could be added to this model and its program could be expanded for gas injection process in fractured reservoirs. Key Words Fractured reservoirs, dual porosity, IMPES, water injection, capillary pressure