Qaidam was part of the North China Craton from at least 1 billion years ago, before breaking off c. 560 million years ago at the end of the Neoproterozoic.
It was an island in a shallow sea until uplift beginning around 400 Ma finally rejoined it to the mainland by 200 Ma.

Three-dimensional modeling shows that the present basin has been squeezed to an irregular diamond shape since the beginning of the Cenozoic, with the Indian Plate beginning to impact the ancient Tibetan shoreline somewhere between 55–35 Ma.
At first, Qaidam was at a far lower elevation.
Pollen found in core samples shows that the Oligocene (34–23 Ma) was relatively humid.
A great lake slowly formed in the western basin, which two major tectonic movements raised and cut off from its original sources of sediment.
At its greatest extent during the Miocene (23–5 Ma), this lake spread at the present 2,800 m (9,200 ft) elevation contour over 300 km (190 mi) and was among the largest lakes in the world.
Nutrient-rich inflows contributed to plankton blooms, which supported an ecosystem that built up reserves of organic carbon.
The Tibetan plateau's uplift, however, eventually cut it off from the warm and humid Indian monsoon.
It went from a forest steppe to a desert.
By 12 Ma, the climate had dried enough to break Qaidam's single lake into separate basins, which frequently became saline.
During the Pliocene (5–2.5 Ma), the focus of most sedimentation was at what is now Kunteyi but, during the Pleistocene (after 2.5 Ma), tectonic activity shifted the basin's tributaries and floor, moving the focus of sedimentation from the Dalangtan to Qarhan area.
During this time, the record's glacial intervals suggest a low-temperature climate and its sandstone yardangs attest to strong winds.

From 770,000 and 30,000 years ago, the enormous lake which filled much of the southeastern basin alternated nine times between being a fresh- and saltwater lake.
Pollen studies suggest the bed of Dabusun Lake in the Qarhan Playa—nearly the lowest point of the basin—was elevated about 700 m (2,300 ft) within the last 500,000 years.
At around 30 kya, this great—at the time, freshwater—lake spread over at least 25,000 km² (9,700 sq mi) with a surface 50–60 m (160–200 ft) above the present levels of its successors.
At the same time, a river from the "Kunlun" paleolake to its south was enriching the Sanhu region with enormous reserves of lithium derived from hot springs near Mount Buka Daban which now feed into the Narin Gol that flows into East Taijinar Lake.

Around 30 kya, the lake in the Kunluns dried up and the Qarhan was cut off from sufficient inflows of fresh water.
It became saline again, beginning to precipitate salts about 25,000 years ago.
The basin's continuing formation and evolution is controlled by the Altyn Tagh fault constituting the northern basin boundary.
Qaidam was part of the North China Craton from at least 1 billion years ago, before breaking off c. 560 million years ago at the end of the Neoproterozoic. It was an island in a shallow sea until uplift beginning around 400 Ma finally rejoined it to the mainland by 200 Ma.
Three-dimensional modeling shows that the present basin has been squeezed to an irregular diamond shape since the beginning of the Cenozoic, with the Indian Plate beginning to impact the ancient Tibetan shoreline somewhere between 55–35 Ma. At first, Qaidam was at a far lower elevation. Pollen found in core samples shows that the Oligocene (34–23 Ma) was relatively humid. A great lake slowly formed in the western basin, which two major tectonic movements raised and cut off from its original sources of sediment. At its greatest extent during the Miocene (23–5 Ma), this lake spread at the present 2,800 m (9,200 ft) elevation contour over 300 km (190 mi) and was among the largest lakes in the world. Nutrient-rich inflows contributed to plankton blooms, which supported an ecosystem that built up reserves of organic carbon. The Tibetan plateau's uplift, however, eventually cut it off from the warm and humid Indian monsoon. It went from a forest steppe to a desert. By 12 Ma, the climate had dried enough to break Qaidam's single lake into separate basins, which frequently became saline. During the Pliocene (5–2.5 Ma), the focus of most sedimentation was at what is now Kunteyi but, during the Pleistocene (after 2.5 Ma), tectonic activity shifted the basin's tributaries and floor, moving the focus of sedimentation from the Dalangtan to Qarhan area. During this time, the record's glacial intervals suggest a low-temperature climate and its sandstone yardangs attest to strong winds.
From 770,000 and 30,000 years ago, the enormous lake which filled much of the southeastern basin alternated nine times between being a fresh- and saltwater lake. Pollen studies suggest the bed of Dabusun Lake in the Qarhan Playa—nearly the lowest point of the basin—was elevated about 700 m (2,300 ft) within the last 500,000 years. At around 30 kya, this great—at the time, freshwater—lake spread over at least 25,000 km² (9,700 sq mi) with a surface 50–60 m (160–200 ft) above the present levels of its successors. At the same time, a river from the "Kunlun" paleolake to its south was enriching the Sanhu region with enormous reserves of lithium derived from hot springs near Mount Buka Daban which now feed into the Narin Gol that flows into East Taijinar Lake.
Around 30 kya, the lake in the Kunluns dried up and the Qarhan was cut off from sufficient inflows of fresh water. It became saline again, beginning to precipitate salts about 25,000 years ago. The basin's continuing formation and evolution is controlled by the Altyn Tagh fault constituting the northern basin boundary.
Qaidam Basin