Abstract Late Cenozoic lacustrine mixed carbonate-siliciclastic sequences in the northwestern Qaidam basin (NW China) are mainly composed of high porosity and low permeability fine-grained rocks but have big potentials of oil-gas commercial production. However, how these fine-grained rocks generate high-quality reservoirs and accumulate hydrocarbons, remains poorly known. This study focuses on shallow-buried Shang Youshashan Formation (Middle–Late Miocene, N22) and Shizigou Formation (Late Miocene–Pliocene, N23) reservoirs and hydrocarbons in Xiaoliangshan area of the northwestern Qaidam basin. We conduct mineralogy, petrography and porosity and permeability analysis for reservoir rocks and biomarker analysis for hydrocarbons and potential source rocks. The results indicate that the N22 high-quality reservoirs are dominated by fractured marlstones and lime mudstones and constitute structural traps, whereas the N23 hydrocarbon reservoirs are mainly composed of siliciclastic-dominantly rocks and form stratigraphic-lithologic traps. Similar biomarker ratios between crude oil samples and Paleogene organic matter-rich rocks reveal that hydrocarbons in the shallow system were likely derived from deep-buried source rocks, rather than late Cenozoic lacustrine fine-grained rocks themselves. In this case, large-scale vertical fractures created by kink band structures in the northwestern Qaidam basin are supposed to facilitate hydrocarbon migration and accumulation. Preliminary production data and exploration well oil-gas test results demonstrate highest yields and thus large hydrocarbon potentials in the N22 marlstone and lime mudstone reservoirs. Collectively, we suggest that relatively high-permeability, fractured and carbonate-rich reservoirs on structural highs are favorable targets for future oil-gas exploration in the northwestern Qaidam basin. This petroleum system provides a typical and significant example for hydrocarbon exploration and development in mixed carbonate-siliciclastic fine-grained rocks of nonmarine petroliferous basins.