The Qinshui basin is an important coal-accumulating basin in China, and its Late Paleozoic coal is an important source rock of coalbed methane in the basin. Its thermal evolution and gas generation characteristics determined the grade of coalbed methane resources, especially the coal measure free gas resources in the basin. Late Paleozoic coal samples were collected for organic geochemical analysis, a high-volatile bituminous coal was used for hydrous pyrolysis, to propose the thermal evolution characteristics, gas generation characteristics, thermal evolution, and free gas accumulation model, and the Ordos Basin is compared. The results show that the variation trends of various geochemical parameters are different with the increase in Ro. Hydrous pyrolysis shows that the gas production potential of coal is excellent. The gases produced consist mainly of CH4, C2–, CO2, and H2. C2– is produced only before the simulated temperature of 550 °C, and oil is produced only before the temperature of 500 °C. The thermal evolution stages can be divided into the immature stage, symbiosis stage, wet gas stage, and dry gas stage, and the symbiosis stage can be divided into the preliminary stage and mainly gas stage. Ro, Tmax, (2+3)MP/(1+9)MP, saturated+arene, Vdaf, and H/C can be used as indicators of the thermal evolution stages. On the plane, the distribution of thermal evolution stages of the Shanxi Formation and the Taiyuan Formation is very alike. The gas generating strength of the Taiyuan Formation is higher than that of the Shanxi Formation. The gas generating strength in the north of the Taiyuan Formation is higher, while that in the south of the Shanxi Formation is higher. The second gas generation stage has a good spatio-temporal configuration relationship with accumulation factors, and the gas production is large, which is beneficial to the enrichment of the coal measure free gas resources. Relatively, the Ordos Basin has better prospects for exploration and development.