On 4 January 2020, an 3.5 earthquake occurred in the Pearl River Estuary (PRE) and was felt at a distance of more than 200 km. According to the China Earthquake Networks Center, this event has been the only earthquake within the PRE since 1900. The Guangdong–Hong Kong–Macau Bay Area (GHMBA) surrounding the PRE is one of China’s most critical financial circles, and coastal earthquake hazard has become an increasing concern. Investigating the source parameter and causative fault of this earthquake is helpful for seismic hazard estimation and mitigation in the GHMBA. In this study, we first determined the focal mechanism of the mainshock using the cut‐and‐paste method. We then used the sliding‐window cross‐correlation method to detect foreshocks and aftershocks before relocating the earthquakes. Finally, we conducted forward modeling to retrieve the rupture directivity of the mainshock, using waveforms of one aftershock as empirical Green’s functions. The results demonstrate that this earthquake was an 3.7 strike‐slip event, with a focal depth of 10 km. The rupture direction of the mainshock was 78°, consistent with the northeast‐east‐trending fault system in the region. The identified source fault confirmed a seismogenic segment of the northeast‐east‐trending fault system in the PRE, which is the primary source of seismic hazard in the area.