Clay shale samples from Cretaceous Madongshan Formation in Well Guye 1 in Liupanshan Basin were collected for determining shale gas exploration prospect through outcrops and core description, rock pyrolysis, X-ray diffraction, and element analysis of kerogen and isothermal adsorption. The following conclusions have been reached:(1) Cretaceous Madongshan Formation of Liupanshan Basin has abundant oil gas shows consisting of fluorescence, oil stains, bitumen and dark shale or oil shale, with a thickness nearly 200 meters in core Guye1. (2) The organic matter type of Madongshan Formation is Ⅱand Ⅲ, the 65% shale samples of Madongshan Formation in core Guye1 have a TOC content higher than 1.0%, with 37.2% shale samples having TOC content higher than 2.0%. The vitrinite reflectance of nearly half samples is higher than 0.8%, and the Tmax is 435~445℃, suggesting that Madongshan Formation is at the low mature to mature stage, and gas reservoir is mixture of biogenic gas and thermal genetic gase. (3) The shale of Madongshan Formation has characteristics of low clay content and higher feldspar and carbonates. The average content of carbonate, feldspar, quartz and clay is 38.2%, 24.4%, 17.2% and 13.2%, respectively, which can meet the demand of shale gas exploration standard of clay content less than 30% and brittle mineral content higher than 40%. The components of clay are mainly illite and illite-montmorillonite, with the average content being 69% and 26.1%. The porosity is between 0.117% and 1.268%, the permeability is between 0.0009 mD and 0.0042 mD, suggesting a low porosity and low permeability reservoir. The isothermal adsorption test shows that Madongshan shale has a strong gas storage capacity, with the methane content being 0.96-4.6 m³/t and the average content being 2.26 m³/t. (4) According to a comparison of geological and geochemical characteristics with shale of Yanan Formation, the authors hold that Madongshan Formation of Liupanshan Basin has a huge shale gas exploration potential and could be regarded as a high quality shale gas reservoir for exploration and development, and the achievements obtained by the authors provide experience for exploration of the unconventional oil and gas reservoirs in the Cretaceous strata of the Hexi Corridor.