The formation of high-quality Chinese medicinal materials is a micro-evolution process of multiple genes involved quantitative inheritance under environmental stress. Atractylodes lancea is traditionally used medicinal plant in China that is broadly distributed and possesses a considerable amount of essential oil. However, to date, limited research has been conducted to characterize the genetics and metabolites of A. lancea shaped by natural variation. Hence, we assembled a high-quality genome of A. lancea, featuring a contig N50 of 1.18 Mb. We further integrated population re-sequencing of A. lancea and conducted analyses to characterize its genetic diversity, population evolution, and rewiring of volatile metabolites. The natural variation effect exerted significant pressure on A. lancea from different geographic locations, resulting in genetic differentiation among three groups. The correlation analysis of metabolites in A. lancea revealed significant natural variations of terpenoids, heterocyclic compounds, ketones, and esters. We also found that 427 metabolites that displayed noteworthy divergence due to directional selection. Additionally, our genome-wide association studies on the metabolome for medicinal quality traits identified several candidate genes, such as AlZFP706 and AlAAHY1, exhibiting significant correlations with atractylodin and hinesol levels, respectively. Overall, this study provides an intricate genomic resource for A. lancea, thereby expanding our understanding of the effect of natural variation on metabolites and facilitating the genetic improvement of its medicinal properties.