Abstract: This is a summary of geological and geochemical data gained in the last two decades since the "Great Battle for Oil".Based on the nature,history of development and sedimentary structures of the basin and in consideration of the environment of oil generation,it is proposed that the Songliao basin is an intracratonic complex basin,formed first by rifting and then by depressing,genetically similar to the North Sea basin.Large scale subsidence of the basin resulted in the extensive "draping" of lacustrine source rocks.The existence of a long inherited deep-water structural depression in the basin made it a favourable region for oil generation.Alternation of compensatory and non-compensatory deposition around the oil generation depression resulted in the formation of several suites of source-reservoir-cap rocks,and the large deltaic complex developed along the long axis of the basin was the principal locus for oil and gas accumulation.Characterization of oil generation in this large lake basin is based on geochemical indicators.In the opinion of the authors,tropical zone and large deep-water lake with rich nutrient in sub-tropical zone of wet climate afford the most favourable environment for generation of oil of continental origin,characterized by; abundancy of organic materials,higher ratio of transfororation of organic matter into oil,presence of kerogen of the sapropel type,ring-like distribution of organic geochemical indicators,isotopes of low carbon number σC³ etc.The evolution of hydrocasrbons is divided into four stages,and evolutionary models for three types of kerogen from different sedimentary facies zones of the large lake basin are constructed.Considering the heat accumulation effect in the high geothermal field of the "draping-type" closed basin and the differences in the properties of the three types of kerogen,the paper also discusses the threshold depth of oil generation,fades zone of maturation,differential maturation and differential expulsiun of hydrocarbons etc.