Abstract: Azimuthal gamma measurement has the advantages of flexible implementation and low interpretation complexity and is widely used in geosteering drilling decision-making. However, the automatic interpretation of azimuthal gamma while drilling has not yet been achieved. Therefore, the dynamic time warping algorithm was adopted to identify the trajectory formation penetration characteristics when there is a relative angle between the trajectory direction and the target layer during the geosteering process. Methods such as piecewise linear approximation and Pearson correlation coefficient were introduced to solve the problems of high computational complexity and singular points in the algorithm. The up and down gamma and left and right gamma were utilized to guide the geosteering decision adjustments for well inclination and azimuth, respectively, and case analyses were conducted. The results indicate that the computational complexity of the improved algorithm is significantly reduced, and the running speed meets the real-time geosteering analysis requirements while drilling. Compared with manual identification, it has higher accuracy. It can not only identify the formation penetration characteristics when the geosteering trajectory approaches the layer interface but also accurately identify the interlayer characteristics that are difficult to distinguish, which helps to improve the passive geosteering situation caused by the shallow detection depth of gamma measurement. The application of this method can increase the drilling encounter rate of geosteering in complex oil and gas reservoirs such as ultra-thin layers and narrow fluvial channels to over 90%. The formation-penetration identification method in azimuthal gamma geosteering based on dynamic time warping algorithm changes the conventional analysis mode relying on manual experience, providing a new technical approach for intelligent application while drilling.