In many sequence-stratigraphic models, the slow sea-level fall stage corresponds to the development of retrograde lowstand slope fans. However, a unified and clear explanation for whether sediment existed at the shelf edge and the resulting sediment stacking pattern during this stage is lacking. Based on observational data and a pre-existing prototype sequence model established according to the data, we found that during the slow sea-level fall stage, a retrograde lowstand wedge can develop at the shelf edge. To explain this retrograde lowstand wedge and clarify its formation mechanism during slow sea-level fall, this study simulated the stratigraphic stacking pattern of a prototype sequence in a passive continental margin basin in the north of the South China Sea using a two-dimensional multi-component model. We then simulated the distribution of accommodation during six stages in a 3rd-order cycle and described the structural changes in the stratigraphic units over 100,000 years. The simulation results indicated that based on the average thermal subsidence of the shelf, differential thermal subsidence and compaction subsidence of sediment lead to the generation of more accommodation at the shelf edge during the slow sea-level fall stage. Moreover, this leads to the retention of more accommodation at the top of the forced regressive wedge before the development of the retrograde wedge (in which compaction plays an important role). Influenced by this, the distribution of accommodation and sediment migrates landward, leading to the development of the retrograde lowstand wedge. The results of this study elucidate the formation mechanism of retrograde lowstand wedges and improve the theory of sequence stratigraphy.