The Miocene Käpfnach seam is only about 0.5 m thick but offers interesting insights into the depositional environments during the early stages (∼16 Ma) of the deposition of the Upper Freshwater Molasse in the Swiss part of the North Alpine Foreland Basin. It is also the most important coal deposit in Switzerland. The study focused on the coal seam, which includes a marly parting (“Stinkstein”), but the underlying and overlying sediments were also investigated. The coal seam, which is separated by the “Stinkstein” parting into a lower and an upper part, was investigated using bulk geochemical data, biomarker composition, isotope data and organic petrography. The coal accumulated in a freshwater environment. High sulphur contents and the presence of carbonate shells in the upper part of the seam reflect a high pH value related to a carbonate-rich environment. A significant part of sulphur in the upper part of the seam is organically bound. Petrographical investigations show that herbaceous plants rather than big trees contributed to the organic matter. Biomarker data show the presence of ferns, angiosperms and gymnosperms, albeit in highly variable proportions across the seam. Representatives of the Cupressaceae, Taxaceae and Sciadopityaceae families contributed to the peat-forming vegetation during the early stages of peat accumulation. Open water areas, colonized by freshwater gastropods, existed during deposition of the upper part of the seam. High contents of inertinite macerals in this part of the seam reflect frequent wildfires in the paleomire surroundings.