Sedimentary and diagenetic processes control the distribution of clay minerals in sedimentary basins, although these processes have seldom been studied continuously in continental sedimentary basins. The Songliao Basin, northeast China, is a large continental, petroleum-bearing basin, and provides a unique study site to understand the sedimentary and diagenetic processes that influence clay assemblages. In this paper, the clay mineralogy of a 2500 m-thick Late Cretaceous (late Turonian to Maastrichtian) terrestrial sedimentary succession (SK-1s and SK-1n cores), retrieved by the International Continental Scientific Drilling Program in the Songliao Basin, was examined. The objective was to determine the diagenetic and paleoenvironmental variations that controlled the formation of clay mineral assemblages, and to determine the thermal and paleoenvironmental evolution of the basin. The results from both cores show that illite is ubiquitous through the succession, smectite is frequently encountered in the upper strata, and ordered mixed-layer illite-smectite (I-S), chlorite, and kaolinite are abundant in the lower strata. Burial diagenesis is the primary control on the observed decrease of smectite and increasing illite, I-S, and chlorite with depth. Observations of clay-mineral diagenesis are used to reconstruct the paleotemperatures and maximum burial depths to which the sediments were subjected. The lowermost sediments could have reached a maximum burial of ~1000 m deeper than today and temperatures ~50°C higher than today in the latest Cretaceous. The transition of smectite to I-S in the SK-1 cores and the inferred paleotemperatures provide new constraints for basin modeling of oil maturation at elevated temperatures in the Songliao Basin. Authigenic kaolinite and smectite are enriched in sandstones with respect to the coeval mudstones from the SK-1n core, as a result of early diagenesis with the participation of primary aluminosilicates and pore fluids. In the upper part of both SK-1 cores, variations in smectite and illite were controlled primarily by paleoenvironmental changes. Increases in smectite and decreases in illite from the late Campanian to Maastrichtian are interpreted as resulting from increasing humidity, a conclusion consistent with previous paleoenvironmental interpretations.