The Erlian Basin may be one of the most promising areas for low-rank coalbed methane (CBM) in China. The Cretaceous coal-bearing strata in the Bayanhua sag contain abundant low-rank CBM resources with suitable depths and large coal thicknesses (1.00–78.85 m, avg.22.53 m). However, the research on CBM geology and exploration potential is still lacking, which severely hinders its exploration and development. This paper presents an integrated study of CBM geology in terms of gas reservoir properties, gas-bearing characteristics and controlling factors. The results of the analysis show that lignite and subbituminous coals are the main coal types present in the study area, with medium porosity (7.3–27.8%, avg.20.77%) and low permeability (0.05–21.8 mD, avg.5.54 mD) being dominant. The pores are dominantly transition pores with inkpot shapes, which is beneficial to the adsorption of CBM. The gas content of the coal seams is 1.66–4.45 m³/t and most coal reservoirs are oversaturated. The CBM is primarily of secondary microbial origin, mostly carbon dioxide reduction. The accumulation of CBM is mainly influenced by the structure type, roof lithology and hydrogeology in the study area. According to the integrated analysis of the vertical changes in the physical properties and gas-bearing characteristics, the dominant horizon tends to be the No. 6-7 coal seam, followed by the No. 6-4 coal seam. Based upon the CBM geology and the factors controlling enrichment, the prospecting potential in the Bayanhua sag was appraised, and two favorable areas are proposed for CBM exploitation.