Volcanism is an important controlling factor for organic matter enrichment and sedimentary evolution in proximal continental lakes. Numerous studies have focused on revealing the intrinsic mechanisms of high organic carbon burial regulated by volcanism, while the understanding of the dynamic evolutionary processes of volcanically induced lacustrine depositional systems remains unclear. We integrated core, logging, and geochemical data from more than 20 fully cored wells spanning all sedimentary facies belts of the Chang 73, to reconstruct the paleoenvironment and establish sedimentary models during volcanism. By combining sequence stratigraphy, carbon isotope chemostratigraphy, zircon U–Pb dating and astronomical cycle techniques, we established a high-precision isochronous stratigraphic framework, spanning ∼241.36 Ma to ∼239.7 Ma. This study presented the first detailed record of sedimentary evolution in response to volcanism in the Ordos Basin: Early volcanism led to a transient, relatively dry-cold climate and low weathering intensity; volcanic ash supplied nutrients to the lake, and the accumulation of loose pyroclastics induced overloading and instability of the delta front, triggering slump-type gravity flows. These factors jointly promoted the formation of tuffaceous shale; and sustained volcanism induced a greenhouse effect, resulting in an extremely humid climate and enhanced weathering, thus inducing hyperpycnal flows and appropriate-intensity hyperpycnal flows facilitate felsic shale formation. Furthermore, the climatic background modulated by astronomical cycles amplifies the sedimentary evolutionary responses to volcanism. Multistage siltstone–muddy siltstone assemblages with good reservoir properties, which act as favorable shale oil “sweet intervals”. This study provides new perspectives for understanding the controlling factors of continental lacustrine basin depositional systems and offers guidance for the spatial prediction of shale oil “sweet spots” in the Chang 73.