Abstract: There are hot debates on the gas source of gas hydrate in the Muli permafrost area of the Southern Qilian Basin. The understanding of gas source directly affects the gas hydrate resource evaluation and exploration. Based on the previous research results and the newly acquired data from the Wells of Mucan 1, Mucan 2 and SK-0, the authors have made a comparison of the source rocks in the Middle Jurassic and Upper Triassic Galedesi Formation. Comprehensive studies on gas compositions as well as carbon and hydrogen isotopic characteristics were also performed. The results show that the gases in the Muli permafrost area of southern Qilian Basin is mainly composed of light hydrocarbon and characterized by wet gases. The isotopic composition of the gas hydrate, which is characterized by positive carbon isotopic series, indicates that the gas is formed by pyrolysis of organic matter and the parent gas is a kind of sapropelic kerogen oil-based gas with low thermal evolution. It is mainly oil associated gas with a small amount of microbial gas and coal-bed methane. The organic matter in the Middle Jurassic is of high abundance and good type, of which the vitrinite reflectivity Ro is between 0.48% and 1.14%, indicating that it is in the peak period of oil generation. The oil associated gas is the main source of the gas hydrate. The organic matter is also abundant and of good type in the Galedesi Formation of Upper Triassic, but the maturity is too high. It remains in the stages of condensate gas or pyrolytic gas, and the total hydrocarbon generation and discharge are poor. As a source of hydrate gas, its contribution is little.