China produced 17.1 billion cubic meters (BCM) of methane sourced from coal seams in 2015, of which 4.43 BCM is from wells drilled from the surface. This level of production is a clear indicator that China has gone into early stage large-scale coalbed methane (CBM) development. CBM resources in China have been extensively investigated since the 1980s. Research has focused on the geological controls of reservoir character. There have been significant advances over the last 37 years that have aided China’s CBM industry. CBM resources less than 2000 m in depth in China are estimated to be 36.81 trillion cubic meters, of which more than 84% occur in nine large-scale basins, such as the Qinshui, Ordos, Junggar, Qianxi, Erenhot, and Hailar. CBM accumulation and coal reservoir characteristics are controlled by the deposition, structure, coal rank, hydrology as well as other geological factors. Each basin has its own unique geological controls that influence the character of CBM reservoirs in both subtle and obvious ways. Coal reservoir geology in some basins or regions in China are still not well understood because of the complexity of the geological settings. At present, large-scale CBM production in China only occurs within the Qinshui and Ordos basins, mostly sourced from middle-to-high rank coal reservoirs. The CBM geology in other basins needs further investigation in order to achieve large-scale commercial production. To this end, the geological research in the paper should address issues such as how to stimulate economic gas flow from deep low permeability reservoirs and how best to efficiently produce from multiple horizons simultaneously. This paper summarizes these and other key issues that are significant scientific and technical challenges for the CBM industry within China.