Expansive playa-lake systems situated in high-altitude piggyback basins are important and conspicuous components of both modern and ancient cordilleran orogenic systems. Extant playa lakes provide vital habitat for numerous endemic species, whereas sediments from these deposystems may record signals of climate change or develop natural resources over geological time. Laguna de los Pozuelos (North-west Argentina) provides the opportunity for an actualistic sedimentological and geochemical assessment of a piggyback basin playa lake in an area of critical interest for understanding Quaternary palaeoclimate dynamics. Silty clays and diatom ooze are the dominant playa-lake centre microfacies, with concentrations of total organic carbon and biogenic silica commonly exceeding 1·5 wt% in this sub-environment. Elemental and stable isotopic analyses point to a mixed organic matter composition in the playa-lake centre, with substantial contributions from algae and transported aquatic macrophytes. Bulk sediment and organic mass accumulation rates in the southern playa-lake centre approach 0·22 g cm−2 year−1 and 2·89 mg cm−2 year−1, respectively, indicating moderately rapid deposition with negligible deflation over historic time. Playa margin facies contain higher percentages of fragmented biogenic carbonate (ostracods and charophytes) and inorganically precipitated aragonite crusts due to seasonal pumping and evaporation of ground water. Organic matter accumulation is limited along these heavily bioturbated wet and dry mud flats. Fluvial–lacustrine transitional environments, which are key waterbird habitats, are either silty terminal splay (northern axis) or sandy deltas (southern axis) containing highly oxidized and partially allochthonous organic matter. Modern analogue data from Laguna de los Pozuelos provide key insights for: (i) environmental reconstructions of ancient lake sequences; and (ii) improving facies models for piggyback basins.