The distributions of lipids in surface and subsurface sediments from the northern South China Sea were determined. The n-alkanes were in bimodal distribution that is characterized by a centre at n-C16–n-C20 with maximum at C18 (or C19) and n-C27–n-C31 as well as at C29 (or C31). The short-chain alkanes suffered from significant losses due to their slow deposition in the water column, and their presence with a slight even carbon predominance in shallow seafloor sediments was ascribed mainly to the direct input from the benthos. The long-chain alkanes with odd predominance indicate transportion of terrigenous organic matter. Immature hopanoid biomarkers reflect the intense microbial activity for bacteria–derived organic matter and the gradual increase of maturity with burial depth. Abundant n-fatty acid methyl esters (n-FAMEs) that are in distributions coincident with fatty acids were detected in all samples. We proposed that the observed FAMEs originated from the methyl esterification of fatty acids; methanol production by methanotrophs and methanogenic archaea related to the anaerobic oxidation of methane, and sulfate reduction provided an O–methyl donor for methylation of fatty acids. The CH4 released from hydrate dissociation at oxygen isotope stage II of Cores ZD3 and ZS5, which had been confirmed by the occurrence of negative δ13C excursion and spherical pyrite aggregates, could have accelerated the above process and thus maximized the relative content of FAMEs at ZD3-2 (400–420 cm depth) and ZS5-2 (241–291 cm depth).