A considerable portion of the upper member of the Mid-Proterozoic Newland Formation, Meagher County, Montana, consists of carbonaceous silty shales (striped shale facies). This type of shale facies is common in Proterozoic basins and is host to several major base metal deposits. The striped shales were deposited in a subtidal setting, basinward of carbonates characterized by cryptalgal laminites, mudcracks and flat pebble conglomerates. The carbonaceous silty shales are considered remnants of benthic microbial mats. Irregular internal laminae, patterns of particle trapping, mechanical deformation during penecontemporaneous soft-sediment deformation and filamentous microbiota provide evidence for this interpretation. The dolomitic clayey shale contains graded silt-clay couplets, and these are interpreted as storm layers. Modern subtidal microbial mats can only survive under special conditions, but in the Proterozoic, it is suggested that benthic microbial mats colonized the shallow seafloor during periods of low sediment input, leading to the formation of carbonaceous shales.