Berthierine oolitic ironstones have been found in the subsurface lower Miocene strata of the Tenggol Arch area, offshore Peninsular Malaysia. The ironstones occur within a 30 to 50 m-thick laterally extensive unit of very finely laminated to massive dark green mudstone, known as the "Terengganu shale". This shale unit was deposited during a regional marine transgression over the Tenggol Arch, which is a fault-bounded pre-Tertiary basement high that separates the Cenozoic intracratonic Malay and Penyu basins at the southwestern margin of the ancestral South China Sea. The oolitic ironstone beds, up to 45 cm thick, have sharp erosional bases and are composed of mainly berthierine ooids and pisoids, some terrigenous quartz-feldspar clasts, and locally, phosphatic ooids. Thicker ironstone beds occurring in the lower part of the shale unit show gradation from granule sandstone to oolitic ironstone. Sedimentological evidence suggests that the oolitic ironstones were deposited as offshore shelf storm layers. The close association of terrigenous clastic grains with the berthierine ooids suggests that these ooids were derived from lateritic soils on land. Transformation of the lateritic soil ooids into berthierine ooids, possibly via an intermediate odinite phase, took place under reducing, early diagenetic conditions. Like many other ironstone deposits described in the literature, the Terengganu ironstones were deposited during a period of sea-level highstand coincident with a marked reduction in terrigenous coarse-grained sediment influx. Palynological evidence further suggests that deposition of the Terengganu shale took place during a dry climatic phase which may have caused the reduction of terrigenous influx into the basin and promoted ironstone accumulation. Phosphatic ooids are found in the ironstones deposited near the inferred early Miocene shelf edge, and they are texturally similar to phosphatic ooids described from modern continental margins. They were probably formed during early diagenesis near the sediment-water interface under anoxic bottom conditions and then were subsequently reworked and mixed with the berthierine ooids. The occurrence of phosphatic ooids near the paleo-shelf edge suggests that the anoxic bottom conditions favorable for phosphate deposition may have been related to upwelling at the paleo-shelf margin.