When Basil Hallward first discusses Dorian with Lord Henry, it is his own soul, and the effect Dorian has on it, which is the focus of his attention. Discussing the book in his letters, Oscar Wilde said that, while he wished he could be Dorian Gray, and the world saw him as Lord Henry, he was, in fact, closer to Basil than to any other character: the expressive artist, captivated by beauty. Wilde also accused Basil of his own most characteristic fault: placing far too high a value on physical appearances.
Basil initially sees Dorian's soul as flawless, but this is only because his appearance is beautiful. He supports Dorian's decision to marry Sibyl Vane, because he thinks she is also beautiful, both physically and spiritually, which means that the two of them belong together. However, he soon discovers that Dorian is capable of great cruelty and comes to see his soul as corrupt, unworthy of its enduring physical beauty.
In The Picture of Dorian Gray, Wilde created a myth, and he never explains or tries to explain how the portrait displays the physical signs of Dorian's sins. There is no indication that Basil himself was the creator of this supernatural attribute of the portrait he painted. Nonetheless, the deterioration in the portrait reflects Basil's growing realization that Dorian's soul is far from the perfection he imagined.