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Jarosite and other metal sulphates are common on Mars and are interpreted to have formed in an extreme acidic saline aqueous environment, similar to modern Earth analogues where jarosite precipitates. We examined an alternative Earth analogue, at the Smoking Hills (known as Ingniryuat by Inuvialuit), Northwest Territories, Arctic Canada. The Smoking Hills are characterised by auto-combusting pyritic mudstones of the Smoking Hills Formation in a polar desert. The Smoking Hills Formation was deposited in an outer shelf to slope marine environment, during a Late Cretaceous Ocean Anoxic Event. Oxidative weathering of this unit creates extensive jarosite-rich deposits, and banded jarosite- and phyllosilicate-rich mudstones, similar to those observed on Mars. Slumping of these mudstones exposes large masses to atmospheric oxygen leading to generation of high temperatures (sufficient to produce paralavas) through pyrite oxidation, and the subsequent formation of a diverse suite of hydrated metal-sulphate minerals. Weathered combustion sites are characterised by a simpler jarosite-rich mineralogy along with thermally-altered mudstone. Away from sites of auto-combustion (bocannes), pyrite-rich layers within the mudstone oxidise to jarosite, creating a yellow-banded appearance in outcrops. These jarosite-rich layers, similar to those observed interbedded in mudstones on Mars, reflect post depositional oxidation processes - not acidic conditions during the time of deposition. As such, this could reflect a more habitable environment than is commonly interpreted for Mars.