The petroleum system concept and related theory are systematically reviewed in this work using published studies. In light of the recent success in exploiting unconventional petroleum resources, the classic petroleum system concept cannot be used to account for the vast unconventional oil and gas accumulations within the petroleum system. The whole petroleum system model is here adopted to investigate both the conventional and unconventional hydrocarbon resources in the Mahu sag, Junggar Basin, China. The whole petroleum system in the study area developed in Permian strata deposited within a large, alkaline lacustrine basin, comprising conventional and unconventional reservoirs that coexist orderly. The Permian Fengcheng Formation in the Junggar Basin is a unique alkaline lacustrine source rock that ranges from low maturity to high maturity, contains abundant organic matter and volcanic materials, and has a high oil-generating potential. Different types of hydrocarbon reservoirs are distributed from the margin to the center of the sag and vary from conventional fan-delta accumulations in fold-thrust belts (i.e., conventional conglomerate reservoirs) to unconventional tight and shale oil accumulations located within the source rock sequences. The distribution and coexistence of different types of hydrocarbon accumulations in the Mahu sag provide new opportunities for exploration and insights into the development of petroleum systems. This whole petroleum system model that developed in the Junggar Basin has implications for the exploration of both conventional and unconventional hydrocarbons in petroleum basins worldwide, especially in deep strata.