Abstract: Good source conditions are the material basis and basic prerequisite for hydrocarbon formation, according to the theories of petroleum system and the pool-forming dynamics. However, the research of Paleogene hydrocarbon sources is lack in the Yinggehai Basin. This paper has, for the first time, made a systematic analysis on the distribution of Paleogene continental deposits and the characteristics of the lacustrine and coal-bearing source rocks based on regional geology and tectono-sedimentary evolutionary histories in the Yinggehai Basin. Using comprehensive geophysical and geochemical methods and the results of seismic interpretation in the slope zones and on the Lingao bulge, where the overlying Neogene-Quaternary sediments are thin and Paleogene buried shallowly, the paper confirms the existence of Paleogene hydrocarbon Source. On the basis, Paleogene hydrocarbon source condition and its petroleum geological significance were analyzed in details. The results show that the abundance and maturity of the organic matter and the type of source materials differ from place to place. Moreover, in the light of the distribution and the controlling factors of the Paleogene source rock, the paper made a forecast of favorable exploration areas of Paleogene reservoirs and buried hill reservoirs preliminarily.