Observations from a recent meteorological experiment in the Meteor Crater, a small, near circular, enclosed basin, in northern Arizona of the United States, are used to investigate the status of the atmosphere in the basin as indicated by temperature inversion and its relationship to ambient atmospheric conditions. Strong synoptic winds aloft do not necessarily imply that no inversion could develop in the basin. Instead, the near-surface wind over the plain surrounding the basin is found to be a more important factor in determining whether the basin atmosphere would be coupled to, or decoupled from, its ambient environment. A necessary condition for the decoupling and the development of a strong inversion overnight is that the mean nighttime temperature over the plain needs to be less than 5 m s−1. The low-level stability of the ambient environment also plays an important role. It was found that as long as the bulk Richardson number over the plain is less than 0.6, turbulence would exit over the plain and influence the basin atmosphere at least partially through the night, preventing a strong temperature inversion from developing in the basin. The strength of the inversion in the basin appears to be increase exponentially with the longwave radiation loss from the upper basin sidewalls. Over the basin floor, the relation between inversion strength and longwave radiation loss is poor mainly because the cooling of air over the basin floor is a combination of radiative cooling and the drainage of cold air from the sidewalls.