Lime mud (i.e., micrite) is a major component of carbonate deposits. Various mechanisms (biotic versus abiotic) have been proposed for the formation of lime mud in Earth’s history. However, the detailed role that microbes play in the nucleation and subsequent precipitation of micrites remains to be resolved. Herein we undertook a detailed geobiological characterization of laminated lime mudstone from the Middle Triassic Guanling Formation in Yunnan Province, southwestern China. Morphological features, together with previous geobiological investigations, suggest that the laminated lime mudstones represent the former presence of microbial mats. These lime mudstones consist mainly of calcite, dolomite and quartz, with clay minerals and pyrites as subordinate components. In particular, micro-analysis shows copious nano-globules (65–878 nm) and capsule-shaped nano-rods in laminations. These low-Mg calcite nano-globule aggregates are closely associated with mucilaginous biofilms resembling extracellular polymeric substances (EPS). Nano-sized globules coalesce to form semi-euhedral micrite crystals. We suggest that a decaying hydrolytic destruction of the EPS by microbial communities within microbial mat leads to the precipitation of the nano-globules by enhancing alkalinity in local micro-environment. As an intermediate, these nano-globules further aggregate to form micrite crystals possibly through a dissolution-reprecipitation process.