Precambrian sedimentary and volcanic rocks of the Vermilion district in northeastern Minnesota were deformed and weakly metamorphosed during batholith emplacement about 2700 m.y. ago. Two main episodes of folding and deformation. F1 and F2 have previously been recognized in the Tower area. The F2 folds are open to tight, and for the most part plunge steeply to the east in near-vertical axial surfaces. The major F1 folds are isoclinal, with near-horizontal hinge lines. A metamorphic fabric consists of a slaty cleavage parallel to the axial surfaces of the F2 folds and a mineral lineation sub-parallel to the fold hinges.Finite strain was determined using clasts in the coarser sedimentary/volcanoclastic units. The maximum extension (λ1) direction is parallel to the mineral lineation and the minimum extension (λ3) direction is normal to the cleavage. The strain is of constrictional type where the mineral lineation is dominant and of flattening type where the cleavage is dominant. The strain data can best be accounted for in terms of a single deformation, that producing the F2 folds. This is paradoxical because fold style indicates that the F1 deformation was at least as intense as the F2. The problem can be resolved if the F1 folds were of soft sediment origin, resulting from downslope slump movements, such that the clasts remained internally unstrained during this deformation. A single tectonic deformation, involving lateral compression and vertical extension between the two intruding batholiths, satisfactorily accounts for the strain data, the development of the F2 folds, and the present overall structural configuration.