The continental shale oil in the second member of Paleogene Funing Formation in the Qintong Sag, Subei Basin has the characteristics of high and stable production. Based on the analysis of the formation conditions of shale oil, the genesis of shale oil is revealed according to crude oil geochemical characteristics and physical properties. Results show that the mud shale in the second member of Funing Formation in the Qintong Sag is widely distributed and thick, with medium organic matter abundance and moderate thermal evolution, which provides a good material basis for the formation of shale oil. The shale oil in the second member of Funing Formation has the characteristics of low gas/oil ratio and high pressure, which belongs to low sulfur and light to medium oil, with high content of saturated hydrocarbon and light hydrocarbon, and the associated gas of crude oil is mainly methane. The shale oil has high content of β-daucane and gammacerane, and its sterane content of ααα-C29 (20R) is higher than that of ααα-C27 (20R), indicating that it is formed in the reduction environment of salt water. Thermal evolution is the key factor controlling the quality of continental shale oil. The second member of Funing Formation in the deep sag zone is at the peak of hydrocarbon generation, and the shale oil has good fluidity. The mud shale in the Ⅰ and Ⅱ submembers of the second member of Funing Formation generally contains suberinite (6.6%) and amorphous body of benthic algal (11.5%), and can generate oil and gas at the mature stage, which is conducive to the formation of light components. The mud shale in the second member of Funing Formation has the characteristics of moderate organic matter abundance and mineral composition, and its oil adsorption capacity is poor, making the remaining oil mainly free oil (69%-96%).