Analyses of organic carbon, nitrogen, sulfur and iron have been performed in order to understand sources and preservation of organic matter in black shale of the Buxin Formation (Early Paleogene) from the Sanshui Basin. The C/N ratios show that the organic matter is characterized by a mixture of terrestrial and phytoplanktonic contributions. The relative importance of different sources depend on climate conditions and most of organic matter is of terrestrial origin. The relationships between C, S and Fe indicate that the brackish environment with alternation of anoxia and low-O2 developed in the bottom waters during the deposition of these organic-rich sediments as a result of a mixed setting of thermal stratification and salinity stratification, the latter being the consequence of intermittent sea water incursion. Bacterial sulfate reduction is the most effective early diagenesis affecting the preservation of organic matter. The intensity of sulfate reduction is related to the relative proportion of metabolizable organic matter supplied to sediments.