Source processes of injection‐induced earthquakes involve complex fluid‐rock interaction often elusive to regional seismic monitoring. Here we combine observations from a local seismograph array in the Montney Formation, northeast British Columbia, and stress modeling to examine the spatiotemporal evolution of the 30 November 2018 Mw 4.2 (ML 4.5) hydraulic fracturing‐induced earthquake sequence. The isolated occurrence of the mainshock at a depth of ∼4.5 km in the crystalline basement 2 days following injection onset at ∼2.5 km depth suggests direct triggering by rapid fluid pressure increase via a high‐permeability conduit. Most aftershocks are in the top 2 km sedimentary layers, with focal mechanisms indicating discrete slip along subvertical surfaces in an ∼1 km wide deformation zone. Aftershock distribution is consistent with static stress triggering from the Mw 4.2 coseismic slip. Our analysis suggests that complex hydraulic and stress transfer between fracture networks needs to be considered in induced seismic hazard assessment. Plain Language Summary Seismicity linked to hydraulic fracturing (HF) in shale gas exploration in western Canada has increased drastically over the last decade. However, details of induced seismicity sequence evolution and triggering mechanism(s) remain unclear. In this study, we integrate local seismic monitoring and numerical stress modeling for an Mw 4.2 (ML 4.5) HF‐induced earthquake sequence in northeast British Columbia, to reveal a two‐step stress transfer process. A nascent, near‐vertical fracture network in the sedimentary layers likely developed in the fault growth and basin infill of the Dawson Creek Graben Complex and hydraulically channeled injected fluids to a thrust fault in the basement, leading to a rapidly increased fluid pressure that initiated the mainshock rupture. Static Coulomb stress change from the coseismic slip subsequently triggered the aftershocks along subparallel slip surfaces within the overlying sedimentary sequences. Our results also suggest that the relative injection volumes and/or wellbore pressures required to create HF at each stage of neighboring wells may be diagnostic of the presence of hydraulic connectivity to the basement, which tends to promote large magnitudes events. Key Points Source parameter inversion and numerical modeling is performed for an Mw 4.2 hydraulic fracturing‐induced earthquake sequence in northeast BC Mainshock is triggered by rapid fluid pressure increase via a hydraulic conduit channeling fluids from injection points to a basement fault Most aftershocks are triggered by static Coulomb stress changes resulting from mainshock coseismic slip