Abstract The Lower Permian Penrith Sandstone in the Vale of Eden represents the deposits of fossil aeolian dunes, which are well cemented by syntaxial quartz overgrowths in the northern part of the outcrop. The overgrowths possess a complex internal growth fabric as revealed by scanning electron microscopy-cathodoluminescence. Fluid inclusions are common in the overgrowths and occur in three associations. Small, subrounded, mostly liquid-rich, two-phase, primary aqueous inclusions occur in the concentrically banded growth zone. Similar primary inclusions occur concentrated in growth imperfections aligned orthogonally to the growth direction. A third association comprises irregular, elongate inclusions that occur along healed microfractures. Salinities in all three associations vary from 13.5 to 23 wt.% NaCl equivalents, whereas measured homogenization temperatures range from 69 to 280°C. This variation results from necking of the inclusion populations after vapour phase nucleation and, as a consequence, the measured homogenization temperatures are geologically meaningless. However, the smallest inclusions yield consistent T h data of around 70°C, which is equivalent to a T t of around 95°C in the absence of methane. A variety of iron oxyhydroxides carry the magnetic remanance in the Penrith Sandstone. The characteristic magnetization is carried by hematite, which occurs in several textural forms. This remanence is multicomponent and shows directional scatter along a NNW-SSE great circle. Individual components are difficult to isolate because of the similarity of their unblocking temperatures, but are best interpreted as a mixture of Tertiary normal and reverse elements. Above 530°C a weak, but stable, Early Permian magnetization can be isolated from a number of specimens. A model is proposed in which quartz authigenesis and magnetization took place during burial from alkaline-rich fluids derived from the Eden Shales. Authigenic hematites precipitated before and during quartz cementation at temperatures of around 95°C. The fluid inclusion microthermometry and thermal demagnetization data are consistent with the Penrith Sandstone attaining a maximum burial temperature of about 120°C. For necking to have caused entrapment of inclusions containing both liquid and vapour suggests that the Penrith Sandstone underwent burial into the all-liquid field, trapped inclusions and then underwent cooling, equivalent to a temperature decrease of 30–40°C. This temperature decrease may be a consequence of regional uplift or, alternatively, the Penrith Sandstone may have been heated and cooled following a transient flush of hot, migrating fluids, possibly related to the shallow intrusion of magma into the basin in Tertiary times. The origin of the Tertiary remanence in the Penrith Sandstone is compatible with fluid inclusion data and is considered to be a combination of chemical remanent magnetization and partial thermoremanent magnetization which was blocked during the Tertiary cooling.