The chemical composition of groundwater in a petroleum-contaminated site is determined by the present functional groups and these play a vital role in a feasibility remediation technique. Based on the in situ investigation of a contaminated shallow groundwater in an oilfield, Fourier transform infrared (FTIR) spectroscopy associated with chemometric treatments, principal component analysis (PCA), and simple-to-use interactive self-modeling mixture analysis (SIMPLISMA), were used to decipher the biodegradation process by analyzing the conversion of functional groups. Environmental factors that can influence microbial metabolism were also evaluated for a comprehensive explanation. FTIR spectroscopy and PCA results showed that the contamination in the study area can be divided into three parts based on FTIR spectra: (1) regular contamination plume distribution and biodegradation level to fresh oil, (2) moderate biodegradation area, and (3) intensive biodegradation area. FTIR spectra further revealed the present functional groups as aliphatic, aromatic, and polar family compounds. SIMPLISMA was used to discuss the degree of biodegradation along the flow path quantitatively and qualitatively and elucidated that the aliphatic and aromatic compounds were mainly metabolized into polar compounds with nitrogen, sulfur, and oxygen via microbes. During metabolism, microbial indices, such as the Shannon–Weaver, Simpson, and Pielou indices, indicated that microbial diversity did not greatly change; hence, hydrocarbons were constantly consumed to feed dominant microbes. Dissolved oxygen concentrations decreased from 4.58 ± 0.31 mg/L (in monitoring well Z1) to 3.21 ± 0.26 mg/L (in monitoring well Z16) and then became constant in the down-gradient area, demonstrating that aerobic biodegradation was the dominant process at the up-gradient plume. Results were in accordance with the oxidation index, which continuously increased from 0.028 ± 0.013 (in monitoring well Z1) to 0.669 ± 0.047 (in monitoring well Z10), showing that oxygen was consumed along the flow path. Similarly, concentration changes in Fe2+, Mn2+, and SO42− proved that the down-gradient area was in reduction condition.