Gas hydrates are expected to be a potential energy resource with extensive distribution in the permafrost and in deep ocean sediments. The marine gas hydrate drilling explorations at the Eastern Nankai Trough of Japan revealed the variable distribution of hydrate deposits. Gas hydrate reservoirs are composed of alternating beds of sand and clay, with various conditions of permeability, porosity, and hydrate saturation. This study looks into the multiphase flow behaviors of layered methane hydrate reservoirs induced by gas production. Firstly, a history matching model by incorporating the available geological data at the test site of the Eastern Nankai Trough, which considers the layered heterogeneous structure of hydrate saturation, permeability, and porosity simultaneously, was constructed to investigate the production characteristics from layered hydrate reservoirs. Based on the validated model, the effects of the placement of production interval on production performance were investigated. The modeling results indicate that the dissociation zone is strongly affected by the vertical reservoir’s heterogeneous structure and shows a unique dissociation front. The beneficial production interval scheme should consider the reservoir conditions with high permeability and high hydrate saturation. Consequently, the identification of the favorable hydrate deposits is significantly important to realize commercial production in the future.