The Thermopolis Shale is a geologic formation which formed in west-central North America in the Albian age of the Late Cretaceous period. Surface outcroppings occur in central Canada, and the U.S. states of Montana and Wyoming. The rock formation was laid down over about 7 million years by sediment flowing into the Western Interior Seaway. The formation's boundaries and members are not well-defined by geologists, which has led to different definitions of the formation. Some geologists conclude the formation should not have a designation independent of the formations above and below it. A range of invertebrate and small and large vertebrate fossils and coprolites are found in the formation.

The Western Interior Seaway was an inland sea that existed from the Late Jurassic (161.2 ± 4.0 to 145.5 ± 4.0 million years ago [Ma]) to the end of the Paleogene (66 to 23.03 Ma). It existed in the middle of North America, extending from the Arctic Ocean to the Gulf of Mexico. It was roughly 3,000 miles (4,800 km) long and 1,000 miles (1,600 km) wide. The seaway was relatively shallow, with a maximum depth estimated at 660 to 1,640 feet (200 to 500 m).

A foreland basin existed just to the east of the Sevier orogenic belt, which was inundated by the Western Interior Seaway. A forearc on the western side of the basin made this deeper than the eastern side, encouraging the build-up of sediment and, in time, sedimentary rock. Erosion of the Western Cordillera also contributed to the build-up of sedimentary rock on the western edge of the basin, while the more low-lying area to the east provided much less. Changes in the amount, type, rate, and other aspects of the sedimentation were caused by uplift, subsidence, sea level changes, and other factors. The water in the basin made at least two major advances and one major retreat during the Cretaceous, adding complexity to the rock and permitting the creation of riverine, marsh, and estuarine rock in addition to the principal shallow and deep marine rock.

Dating of bentonite and palynological evidence indicate that the Lower Thermopolis Member was deposited between 100.3 and 98.5 Ma. A study of Inoceramidae bivalves confirmed a Late Albian age. Deposition of the upper three members of the Thermopolis Shale occurred over approximately 7 million years.

The Thermopolis Shale was first identified in 1914 by geologist Ferdinand F. Hintze, Jr. He called it the "Lower Benton Shale", and included the Mowry Shale in the same formation. Hintze described three members: The basal "rusty beds", a lower shale, a 25-to-40-foot (7.6 to 12.2 m) thick "Muddy Sand" (muddy sandstone), and an upper shale member. (The fourth member of the "Lower Benton Shale" was the Mowry Shale.)

The Thermopolis Shale was first named by geologist Charles T. Lupton in 1916. Lupton described the rocks as a formation lying conformably atop the Cloverly Formation, and conformably underlying the Mowry Shale. The Thermopolis Shale was the basal of four formations making up the Colorado Group. He described the Thermopolis Shale as Late Cretaceous in age, generally dark in color, from 710 feet (220 m) thick, and with sandstone lenses common. At least one member of the Thermopolis Shale was also noted, a "muddy sand" layer about 15 to 55 feet (4.6 to 16.8 m) thick. No type locality was identified, but the formation was named for the town of Thermopolis in Hot Springs County, Wyoming—where, nearby, outcroppings of the shale were well exposed. Lupton's division of the Thermopolis Shale was adopted by the United States Geological Survey and used for the next 50 years.

The stratigraphic history of the Thermopolis Shale was first outlined by geologist Don L. Eicher in 1962.

The Thermopolis Shale belongs to both the Colorado Group and Dakota Formation. Both historically and currently, the stratigraphic units in these groups, and in the Thermopolis Shale, have been unclear, and the nomenclature used by geologists is not standardized. The identification of beds, members, and formations and their names have changed over time as well.