Abstract: By means of the modern testing technology and experimental methods, we study geochemical characteristics of lignite of Paleogene in Longkou Coalfield and analyze generating potential of biogenic gas. The results of the study showed that, average R_o value of Longkou lignite was 0.41%, and it was at the immature stage . High volatile content showed that the biodegradable potential was great . Huminite content was dominant , and it embodied high biochemical activity . Extraction rate of chloroform bitumen "A" was between 1.8% to 7.5%, so it belonged to good source rocks. Characteristics of group composition indicated that lignite was in early stages of the evolution of organic matter, and it was conducive to biogenic gas. The distribution characteristics of saturated hydrocarbon showed that the sedimentary environment was deep fresh and brackish lacustrine deposited in weak reduction and the source material was mixed with the lower aquatic organism. The maturity of humic acids was low, the degree of aromatic ring was low, and the source material was mainly terrestrial plants with vascular bundle. Geochemistry of lignite in Longkou Coalfield suggested that it had good generating potential of biogenic gas.