We present results from a seismic and magnetic study of acoustic basement beneath the southern Iberia Abyssal Plain. An ocean-continent transition zone (OCT), characterized by subdued basement relief and weak magnetization, lies seaward of thinned continental crust. Its western edge is a region with isochron-parallel ridges and generally higher basement magnetizations. The width of the OCT decreases to the north. The seaward change in basement morphology coincides with changes in seismic velocity structure, but in both regions, anomalously high velocities at shallow depths within acoustic basement suggest that the OCT consists largely of serpentinized peridotite. Our magnetic and seismic data support the hypothesis of exhumed upper mantle, more than that of ultraslow sea-floor spreading, for the origin of the OCT.