Abstract: Yiliping-Sanhu area in Qaidam basin has no major exploration breakthrough for its Neogene strata that have been dilled up to now just have some shows of natural gas. In this paper, the core lab tests of the aboundance, kerogen type and maturity indexes of the organic matter from the Neogene source rocks were presented, by which the deep gas accumulation condition and exploration potential were analyzed. It is recognized that the type of organic matter of the Neogene is dominated by Type Ⅱ2 and Type Ⅲ, and the N22 and N12 have maximum thickness of dark mudstone in vertical in this area; the source rocks get into gas threshold at depth of 2 800 m and generate abundant thermogenic gas starting with 4 000 m, showing that this area has a certain amount of gas resource. In sedimentary facies, the Neogene appears lake and delta developed with shore shallow lake sand bank, delta front sand bank and channel sand, etc., so the physical properties are mainly controlled by sedimentary microfacies, particle size and buried depth. The potential deep gas exploration domain or targets could be in Tahu-Sebei, Jianshishan-Chuanxingqiu and Jianshan-Hongsanhan areas