Through coreflood and micromodel studies, it has been shown that carbonated water injection (CWI) can improve oil recovery compared to conventional waterflood. However, in most early studies, either a refined oil or dead crude oil had been used, which is not representative of a real oil reservoir where the oil has significant dissolved gases. In such studies, oil swelling and oil viscosity reduction had been introduced as the main mechanisms of additional oil recovery by CWI. However, in our direct flow visualization (micro model) studies reported here, we have used live crude oil, and we have observed the formation and growth of a new gaseous phase inside the oil when it comes in contact with carbonated water (CW). The aim of this work is to visually study the effect of this phenomenon on oil recovery by CWI at pore scale. In this paper, we present the results of two high-pressure high-temperature direct flow visualization (micromodel) experiments which have been performed using a live crude oil sample. These include a tertiary (post-waterflood) and a secondary (pre-waterflood) CWI experiment performed at 2500 psia and 100 degrees F. The results of our secondary and tertiary CWI showed that CWI can improve the oil displacement and recovery compared to conventional waterflood. Although both secondary and tertiary CWI improved oil recovery significantly, the performance of CWI was better when it was injected instead of conventional waterflood (secondary) rather than after conventional waterflood (tertiary). On the basis of our study, the predominant mechanism that led to this additional oil recovery was the formation and growth of a new gaseous phase within the oil. Formation of the new phase improved the oil recovery through (i) reconnection of the trapped oil and oil displacement, (ii) creating a favorable three phase flow region with less residual oil saturation, and (iii) restricting the flow path of OAT and diverting it toward unswept areas of the porous medium. Formation of the new phase happened faster and stronger when CW was injected as secondary, and its final saturation, for a fixed period of CWI, was higher than its final saturation in tertiary CWI. We also show that the nucleation and growth of the new gaseous phase is directly proportional to the amount of hydrocarbon gas dissolved in the oil which is a function of oil properties and saturation pressure and temperature.