The investigation of bulk and molecular compositions in organic matter at the Bashibulake Section in the SW Tarim Basin, West China, across the Paleocene–Eocene boundary reveals a complex mixture of marine and terrigenous origins during the Paleocene–Eocene Thermal Maximum (PETM) in the eastern Tethys. Source-related biomarkers, such as n-alkanes, isoprenoid alkanes, steranes, hopanes and methylhopanes, exhibit diverse compositions influenced by both marine and terrigenous sources. Sterane and hopane isomer distributions, indicative of immature OM, are primarily controlled by biological configurations. Changes in compound class abundance and isomer ratios reflect variations in source inputs and depositional conditions. Elevated concentrations of n-alkanes from higher plants, along with ratios of C29-C32 moretanes/hopanes and C31/C32 homohopanes, suggest increased terrigenous OM supply during the PETM. However, the significant differences in concentration between n-alkanes from higher land plants and bacterial hopanes, coupled with the presence of 2α-methylhopanes, prevalence of C27 compounds in regular steranes, and absence of oleanane suggest a dominant aquatic bacterial contribution. The study highlights the role of enhanced continental flux and warming in stimulating microbial activity, enriching OM, a factor often overlooked by other analytical methods. The absence of carbonate carbon and low trisnorhopane isomerization provide supportive evidence of ocean acidification and carbonate dissolution during the PETM. Reduced pregnanes and tricyclic terpanes, along with low degree of hopane and sterane isomerization, indicate rising sea levels and low salinity. The findings emphasize the significance of the biomarker approach in identifying OM origin and characterizing the depositional environment in PETM-related sequences, suggesting a more substantial role of bacterial contributions than previously recognized.