Petroleum geologists have debated whether the hydrocarbons from Jurassic coal measures are derived from the coals, carbonaceous mudstones or coal-measure mudstones in the Turpan Basin. Based on the geochemistry analysis of the 20 crude oils and 40 source rocks from the Turpan Basin, some data have been obtained as follows: carbon preference index and methylphenanthrene index of the Jurassic oils are 1.16–1.45 and 0.28–0.80, and the ααα C29 sterane 20S/(20S+20R) and C29 sterane ββ/(ββ+αα) are 0.44–0.51 and 0.4–0.54 respectively, which show the normal maturity of oils; the vitrinite reflectance of the source rocks from the Xishanyao to Badaowan Formations range from 0.47% to 0.97%, which indicate immature to mature thermal evolutionary stage and sufficient conditions for generating mass mature oil. The effect of hydrocarbon expulsion should be considered when studying the source of coal-derived oil by using Biomarkers. Biomarkers in the Jurassic oils from the basin are similar to those in the coals and carbonaceous mudstones, with a strong predominant content of pristane, relatively high ratio of C15/C16 sesquiterpenoids (>1), a relatively high content of low carbon number tricyclic terpanes and C24 tetracyclic terpane, little gammacerane and C29 Ts detected, an absolute predominant content of C29 sterane and a relatively high content of diasterane. However, the opposite characteristics are shown in mudstones, with an approximately equal content of pristane and phytane, relatively low ratio of C15/C16 sesquiterpenoids (<1), a relatively high content of high carbon number tricyclic terpanes and a low content of C24 tetracyclic terpane, peaks of gammacerane and C29 Ts detected obviously and an increasing C27 sterane content. All of these characteristics identify the coals and carbonaceous mudstones as the possible major oil source rocks in this area, and they were formed in the stronger oxidizing environment with shallower water than mudstones.