Complex environmental controls have influenced deposition of the Gråklint Beds, a prospective oil- and gas-prone Late Triassic (Mid-Carnian) source rock in the Jameson Land Basin, East Greenland. The identification of a Late Triassic source rock is significant for hydrocarbon exploration in the North Atlantic region. Detailed sedimentological analysis, biostratigraphy and geochemical analysis provide insights into the controls on source rock development and have wider implications for palaeoclimatic trends and palaeogeographical reconstructions of the North Atlantic at this time. The Gråklint Beds were deposited in a predominantly lacustrine setting during a phase of climatic cooling that can be ascribed to the ‘Mid-Carnian Pluvial Event’. This further extends the evidence for the global effect of such climatic perturbations and furthermore highlights the potential for the use of climatic events for global and regional correlation between varying environmental settings. Evidence is also recorded for marine ingression, which resulted in the precipitation of magadiite (NaSi7(OH)3.3H2O) and the brief influx of a marine fauna. This provides the most southerly record of marine influence from the Boreal Ocean at this time and has important implications for palaeoenvironmental reconstructions and correlation in the region.