Abstract: Huizhou 26 Sag, Zhuyi Depression, Pearl River Mouth Basin, is a typical faulted basin, which is proved to be rich in hydrocarbon generation. The research on high-quality source rocks is mainly concentrated in the interior of the basin, but there is little research on the characteristics and formation mechanism of source rocks in subsag at the margin of sag. Based on the latest data of earthquake, geochemistry and elements analysis, the geochemical characteristics and formation mechanism of source rocks in the Northeast subsag of Huizhou 26 sag are studied in detail. High quality source rocks were developed in WC4 Formation, with high abundance of organic matter, with an average content of 4.59%, which can reach the standard of “good-very good” source rocks, and organic matter type is Ⅰ-Ⅱ₁, mainly oil-type source rock. During the sedimentary period of the WC4 Formation, Huizhou 26 northeast subsag was strongly faulted, forming a “Deep basin in sag edge”, Less terrigenous debris input, which provided a favorable sedimentary environment for the development of source rocks. Volcanic activities in the same period provided rich inorganic nutrients, form a salt water environment, cause the plankton bloom, and promote the large-scale formation and preservation of organic matter. The comprehensive analysis shows that the discovery of high-quality source rocks in WC4 Formation, Huizhou 26 northeast subsag, expands the distribution of high-quality source rocks to the edge of the sag, which lays a hydrocarbon generation foundation for the future exploration and discovery of the sag, and has important reference significance for the evaluation and exploration potential analysis of subsag at the edge of fault basin in other areas.