The unclear source of oil and gas seeps has impeded the exploration work in the Lesser Himalayan thrust belt in Nepal. In an attempt to address this problem we have carried out comprehensive geological and geophysical surveys, petroleum geochemical investigation, carbon isotope analysis and hydrocarbon- generation history simulation with an aim to explore the source of oil and gas in the Dailekh area of Nepal. Accordingly the following conclusions are drawn: ① The oil seeps along the Padukasthan (PT) fault can be divided into two types. The first type occurred as oil- bearing fault gouge, with chloroform bitumen “A” concentration of 149~231 μg/g and vitrinite reflectance (Ro) value of 0. 81%. The carbon isotopic compositions of chloroform bitumen “A” are heavy with δ13C values ranging from -26. 24‰ to -27. 10‰, which represents a normal carbon isotope sequence. The source rock are yellow- green on the fluorescence thin section. These characteristics show that it is a typical low- maturity coal- derived oil. The second type occurred as a liquid crude oil that has undergone microbial degradation. The analysis result shows the maturity index of adamantine (IMD) from 0. 33 to 0. 45, Ro value from 1. 24% to 1. 53%, dimethyl biadamantane (3,4- DMD) contents of 46%~47%, δ13C values of crude oil from -29. 50‰ to -29. 45‰. The carbon isotopic compositions tend to be consistent. The source rocks display blue fluorescence. These futures are indicative of a marine- facies origin in high- mature stage. ② The source rock of the first oil- type are the coal- bearing layers from the Melpani Formation of Surkhet Group and the Gondwana Group. The oil is a low- mature stage product of the organic matter type III. The second oil- type originated from the shelf facies black shale of the Swat Formation of the Surkhet Group and formed during hydrocarbon- generation peak of organic matter type II1. Both oil- types have no genetic relationship with the over mature black mudstone of the Lakharpata Group and the immature mudstone of the Siwalik Group. ③ The hydrocarbon accumulation patterns in the Lesser Himalayan belt of Nepal are characterized by “multi- sources and multi- stages, increasing maturity of organic matter controlled by thrust activities, sandstone reservoirs, and favorable hydrocarbon accumulation trapped by thick caps”. The hydrocarbon evolution includes five stages: shallow buried sediments, structural trap, deep buried hydrocarbon accumulation and late tectonic reformation. ④ The thrust activities in the Lesser Himalayan belt is conducive to increasing the temperature of the deep buried Gondwana and Surkhet Groups, rapid hydrocarbon generation and late migration and accumulation. It is similar to the neighboring petroleum- bearing basins in Pakistan, implying good conditions for hydrocarbon generation and accumulation in the Lesser Himalayan belt in Nepal.