This study presents new data for the identification of the source and assessment of the thermal maturity of oils based on the diamondoid indices of oils from the Tazhong and Luntai uplifts in the Tarim Basin in northwest China. The oil samples were divided into three groups according to biomarker characteristics and the abundance and distribution of diamondoids. Group I oils are located along the Tazhong No. 1 fault zone, which contained abundant diamondoids and are of high thermal maturity, suggesting they are late-charged hydrocarbons that were derived from a Middle–Upper Ordovician source. Group II oils are mainly located in blocks close to the Tazhong No. 1 fault zone and are dominated by early formed hydrocarbons from Cambrian–Lower Ordovician source rocks. Group III lacustrine oils comprise relatively low concentrations of diamondoids compared with group I and group II oils. Group III oils were sourced from Jurassic or possibly Triassic units and are hosted by the low-relief Yingmaili section of the Luntai uplift. The thermal maturity of the oils in each group was evaluated using diamondoid parameters; a few group I oils exhibit intense thermal cracking. To estimate the extent of oil cracking using the concentrations of diamondoids in oils, this study proposes a practical approach that facilitates the determination of baseline 4- and 3-methyldiamantane concentrations. Application of this method indicates that the Tarim Basin marine oils contain a baseline concentration of approximately 69 ppm.