The Lulehe sandstone in the Eboliang area is a major target for hydrocarbon exploration in the northern Qaidam Basin. Based on an integrated analysis including thin section analysis, scanning electron microscopy, X-ray diffraction, cathodoluminescence investigation, backscattered electron images, carbon and oxygen stable isotope analysis and fluid inclusion analysis, the diagenetic processes mainly include compaction, cementation by carbonate and quartz, formation of authigenic clay minerals (i.e., chlorite, kaolinite, illite-smectite and illite) and dissolution of unstable materials. Compaction is the main factor for the deterioration of reservoir quality; in addition, calcite cement and clay minerals are present, including kaolinite, pore-filling chlorite, illite-smectite and illite, which also account for reservoir quality reduction. Integration of petrographic studies and isotope geochemistry reveals the carbonate cements might have originated from mixed sources of bioclast- and organic-derived CO2 during burial. The quartz cement probably formed by feldspar dissolution, illitization of smectite and kaolinite, as well as pressure solution of quartz grains. Smectite, commonly derived from alteration of volcanic rock fragments, may have been the primary clay mineral precursor of chlorite. In addition, authigenic kaolinite is closely associated with feldspar dissolution, suggesting that alteration of detrital feldspar grains was the most probable source for authigenic kaolinite. With the increase in temperature and consumption of organic acids, the ratio of K+/H+ increases and the stability field of kaolinite is greatly reduced, thereby transforming kaolinite into mixed layer illite/smectite and illite. Within the study area, porosity increases with chlorite content up to approximately 3% volume and then decreases slightly, indicating that chlorite coatings are beneficial at an optimum volume of 3%. A benefit of the dissolution of unstable minerals and feldspar grains is the occurrence of secondary porosity, which may enhance porosity to some extent. However, the solutes cannot be transported over a large scale in the deep burial environment, and simultaneous precipitation of byproducts of feldspar dissolution such as authigenic kaolinite and quartz cement will occur in situ or in adjacent pores, resulting in heterogeneity of the reservoirs.