Abstract: Deposition of black shale of the Lower Cambrian Niutitang Formation (NTT) of the Yangtze Block, South China, in association with the Ediacaran-Cambrian (E-C) transition was accompanied by widespread formation of phosphate nodules. Petrological and geochemical studies of the nodules and host sedimentary rocks were carried out to elucidate hydrographic conditions of the Early Cambrian ocean. Our results reveal that NTT phosphate nodules are composed principally of concentrically banded carbonate fluorapatite (CFA) that likely reflects changing Eh and pH conditions contemporaneous with diagenetic nodule growth. Accumulation of organic-rich sediment and nodule growth may have been induced and sustained by contemporaneous volcanic and hydrothermal activities on the Yangtze Block. The introduction of voluminous nutrients with volcanic ash, including phosphate and aqueous Fe and Si, promoted the bloom of plankton, including sponges and lower algae leading to organic matter enrichment. Productivity may have been further enhanced by upwelling of phosphate-rich bottom water that resulted in widespread phosphogenesis and formation of phosphate nodules. The hyalophane-quartz association documented from phosphate nodules suggests the possible interaction of K-feldspar-rich volcanic ash and Ba-rich hydrothermal fluids at lower pH levels in association with nodule growth. The formation of phosphate nodules of the Niutitang Formation, then, reflects the complex interaction among primary productivity, volcanic and hydrothermal activity, and the accumulation of organic matter at a critical period of Earth history.