Knowledge of the permeability structure of fault‐bearing reservoir rocks is fundamental for developing robust hydrocarbon exploration and fluid monitoring strategies. Studies often describe the permeability structure of low porosity host rocks that have experienced simple tectonic histories, while investigations of the influence of faults with multiple‐slip histories on the permeability structure of porous clastic rocks are limited. We present results from an integrated petrophysical, microstructural, and mineralogical investigation of the Eumeralla Formation (a tight volcanogenic sandstone) within the hanging wall of the Castle Cove Fault which strikes 30 km NE–SW in the Otway Basin, southeast Australia. This late Jurassic to Cenozoic‐age basin has experienced multiple phases of extension and compression. Core plugs and thin sections oriented relative to the fault plane were sampled from the hanging wall at distances of up to 225 m from the Castle Cove Fault plane. As the fault plane is approached, connected porosities increase by ca. 10% (17% at 225 m to 24% at 0.5 m) and permeabilities increase by two orders of magnitude (from 0.04 mD at 225 m to 1.26 mD at 0.5 m). Backscattered Scanning Electron Microscope analysis shows that microstructural changes due to faulting have enhanced the micrometre‐scale permeability structure of the Eumeralla Formation. These microstructural changes have been attributed to the formation of microfractures and destruction of original pore‐lining chlorite morphology as a result of fault deformation. Complex deformation, that is, formation of macrofractures, variably oriented microfractures, and a hanging wall anticline, associated with normal faulting and subsequent reverse faulting, has significantly influenced the off‐fault fluid flow properties of the protolith. However, despite enhancement of the host rock permeability structure, the Eumeralla Formation at Castle Cove is still considered a tight sandstone. Our study shows that high‐resolution integrated analyses of the host rock are critical for describing the micrometre‐scale permeability structure of reservoir rocks with high porosities, low permeabilities, and abundant clays that have experienced complex deformation.