In this work, Huadian oil shale was extracted by water at 350, 365, and 385 °C with a time series (2−100 h) under a closed system to better investigate the carbon isotope fractionation character and its use in predicting the oil recovery rate (ORR). The results revealed that the gas carbon isotope fractionation was controlled by two factors: kinetic and thermal equilibrium processes, the former through primary (ORR increasing stage) and secondary cracking (ORR decreasing stage) during the decomposition of organic matter, and the latter related to the gas−water−rock interaction process after gas decomposing from organic matter. Different from the continuous increase of carbon isotope in the kinetic process, in the thermodynamic equilibrium process, the oxidation/hydration process will increase the δ 13 C CO 2 −CH 4 value, while the water−rock interaction process decreases the δ 13 C CO 2 −CH 4 value. This competition strength controlled by gas generation rate caused δ 13 C CO 2 −CH 4 to show two obvious "turning" points at the beginning of oil generation and the maximum generation of oil. And these "turns" decreased with increasing temperature, which both exist in subcritical and supercritical water. In addition, different from the carbon isotopes of heavy hydrocarbon gas, δ 13 C CH 4 shows a much better relationship with the ORR evolution during the main oil-generation area (the highest R 2 can reach 0.99), even though it has been altered by the thermodynamic equilibrium process after generation. Thus, the carbon isotope and its fractionation character can be used to constrain the oil-generation character and help optimize the heating process during the oil shale exploitation process and lower the production costs.