The Güzelyurt kaolinite deposit is an important source of raw material for the ceramics industry in Turkey. No detailed mineralogical or geochemical characterizations of this deposit have been undertaken previously and these were the goals of the present study. The Güzelyurt alunite-bearing kaolinite occurs along a fault zone in the Late Miocene Gördeles ignimbrite, which consists of dacitic and andesitic tuffs. Horizontal and vertical mineralogical zonations with gradual transitions were observed within the alteration zone. The inner kaolinite, alunite, and 7 Å halloysite zones progress horizontally outward to a smectite zone; and native sulfur- and cinnabar-bearing alunite with 7 Å halloysite and porous silica zones increase as one progresses up through the profile. Fe-(oxyhydr)oxide phases associated with native sulfur and cinnabar demonstrate that multiple hydrothermal-alteration processes resulted in kaolinization and alunitization of the deposit. The kaolinization of feldspar, Fe-(oxyhydr)oxidation of hornblende and mica, the presence of kaolinite as stacked and, locally, book-like forms, and of 7 Å halloysite tubes, and smectite flakes as a blanket on altered volcanic relicts indicate an authigenic origin for this deposit. The leaching of Si + Mg + K and Ba + Rb, the retention of Sr, the enrichment of light rare earth elements relative to the heavy rare earth elements, and the negative Eu anomalies suggest that fractionation of plagioclase and hornblende occurred within the volcanics. The oxygen- and hydrogen-isotopic values of the kaolinite, 7 Å halloysite, smectite, and smectite + kaolinite fractions reflect a steam-heated environment at temperatures in excess of 100°C. An increase in the δD and δ18O values of 7 Å halloysite relative to kaolinite suggests its formation under steam-heated magmatic water, the mixing of steam and meteoric water near the surface, and evaporation. The oxygen- and sulfur-isotopic compositions of alunite suggest the direct influence of steam-derived sulfur. The Güzelyurt alunite-bearing kaolinite deposit is inferred to have formed after an increase in the (Al±Fe)/Si ratio and the leaching of alkali elements, which are driven by the sulfur-bearing low-temperature hydrothermal alteration of feldspar, hornblende, and volcanic glass under acidic conditions within the Neogene dacitic and andesitic tuffs.