In the Yangtze Block, the Early Cambrian Niutitang Formation is mainly composed of mudstone, shale, and carbonates which are important for investigating the depositional environment and evolution of the Early Cambrian rocks. The Niutitang Formation in the study area has a greater geologic interest due to its polymetallic beds, depositional age, variation in environmental conditions, Cambrian explosion, organic matter (OM) enrichment, algal boom, etc. This research represents the sedimentary geochemistry of the Early Cambrian Niutitang Formation to reconstruct the palaeo‐depositional environment and to evaluate the OM enrichment mechanism by means of total organic carbon (TOC), biomarkers, carbon isotopes, mineralogy, scanning electron microscope, etc. Based on the variation in TOC content, the Niutitang Formation is divided into three parts (upper, middle, and lower). The majority of the samples from the middle part of the Niutitang Formation exhibit an excellent source of hydrocarbon (TOC > 4.0 wt%) relative to the upper and the lower part. The lighter carbon isotopic composition (<−30.7%) in these sediments reveals the presence of the I‐amorphous kerogen group. Moreover, these lighter δ13Corg values suggest the presence of type‐I oil‐prone kerogen. Saturated hydrocarbon in these rocks showed the dominance of short‐chain n‐alkanes maximizing at C18. The predominance of these n‐alkanes represents that the OM is chiefly derived from algal/bacterial input. Similarly, the dissymmetric V shape of C27‐C28‐C29 steranes with a predominance of C27 and the higher values of in all three parts reflects that the OM in these rocks is chiefly originated from the lower aquatic marine organisms. Based on the Pr/Ph ratio, it is predicted that the middle part of the Niutitang Formation was deposited in extreme anoxic conditions (Pr/Ph < 0.5), whereas the upper and lower parts were deposited in relatively less anoxic conditions. Some biomarkers have more stable stereochemistry, which cannot be affected by diagenetic processes. These stable configurations are utilized to measure the maturity of OM, that is, Ts/(Ts + Tm), C29ββ/(ββ + αα), C29αα20S/(20S + 20R) steranes, and homohopane C31 22S/(22S + 22R). These geochemical indices reveal that the Early Cambrian Niutitang Formation in the studied area is mature to the post‐mature in the gas generation phase. Moreover, the hydrothermal fluids rich in metallic elements (e.g., Mo, Zn, V, and U) from the deeper part of the Earth owing to elongational forces among Yangtze and Cathaysian plates over Early Cambrian time entered the oceanic basin via remnant features (fissure and cracks) and through upwelling phenomena interacted with shelf sediments. At the ocean's surface, these nutrient‐rich fluids enhanced the breeding and evolution of marine life (bio‐productivity), which created hypoxic water conditions suitable for the preservation of OM in these rocks.