Shales are widely developed in the strata of the Carboniferous-Permian coal measures in the Qinshui Basin, and these shales have great potential for shale gas exploration. In this paper, the shales of the Taiyuan Formation in the eastern Qinshui Basin are studied. The shales of the Taiyuan Formation in the study area are investigated through field investigation, organic geochemical testing, X-ray diffraction, scanning electron microscopy, high pressure mercury injection, low temperature liquid nitrogen adsorption and PetroMod simulation and through other tests to study the reservoir characteristics, such as organic geochemistry, mineralogy, petrology, pore permeability, and gas burial history. The results show that the shales of the Taiyuan Formation are well developed over the whole area with a thickness of more than 60 m. The average organic matter content is 2.95%, and the kerogen type is type III. The shale maturity (average value is 2.45%) corresponds to the stage of high maturity evolution, indicating that a large amount of shale gas has been generated in this area. A high content of quartz and clay minerals indicates a high fracturability. The nanopores in the shale reservoir are well developed at pore sizes between 2˜10 nm and greater than 1000 nm; however, the pores at the other pore sizes are poorly developed, resulting in weak pore connectivity in the reservoir. According to the results of the PetroMod simulation, the shale of the Taiyuan Formation has undergone two subsidence and two uplift processes. The Yanshanian magmatic intrusion is the key factor for the rapid increase in gas production. In addition, the geological structure of the area is relatively simple, and the burial history and caprock thickness are also the main controlling factors of gas generation and preservation. The shale-sandstone-shale combination and shale-coal-shale combination are the main models of shale gas preservation. This comprehensive study suggests that the shale gas of the Taiyuan Formation in the eastern Qinshui Bain has good potential for exploration and development.