In recent years ophiolitic diamonds have been reported mostly from podiform chromitites. However, the mechanism of such diamond formation remains unknown. We report in situ diamond, graphite pseudomorphs after diamond crystals, and hydrocarbon (C-H) and hydrogen (H2) fluid inclusions in ultrahigh-pressure (UHP) peridotitic minerals of the Nidar ophiolite, Indus suture zone. Diamond occurs as octahedral inclusion along with nitrogen (N2) in orthoenstatite. Methane (CH4) also occurs with UHP clinoenstatite (>8 GPa) in orthoenstatite. The graphite pseudomorphs after diamond crystals and primary hydrocarbon (C-H), and hydrogen (H2) fluids are included in olivine. Oriented hematite (α-Fe2O3) exsolutions are also present in the olivines, indicating a precursory β-Mg2SiO4 phase of the host olivines. This assemblage of diamond, graphite, C-H and H2 has not previously been reported from any ophiolitic peridotite. The hydrocarbon fluids in UHP clinoenstatites and retrogressed β-Mg2SiO4 strongly suggest their source from the mantle transition zone or base of the upper mantle. We conclude that the peridotitic diamonds precipitated from C-H fluids during mantle upwelling beneath the Neo-Tethys Ocean spreading center.