A method producing full field radial grid includes both aerial and vertical gridding to divide a reservoir structure into simulation grid cells. The aerial gridding is performed by 1) specifying a reservoir boundary (including faults) and well locations; 2) distributing a set of concentric circles around each well location; 3) determining the circle-circle and circle-boundary intersection locations of these circles; 4) forming the aerial grid by selecting circles, arc segments of intersecting circles and radial lines which connect the ends of these arc segments to the corresponding well center; 5) and forming additional grid lines by selecting the connecting lines of two wells if their circles intersect, adding additional radial lines to certain wells, and connecting end points of certain selected arc segments. The vertical gridding is performed by casting the aerial grid vertically downwardly through all the layers defined in the reservoir structure.