Abstract The formation of clay minerals within active fault zones, which results from the infiltration of aqueous fluids, often leads to important changes in mechanical behaviour. These hydrous phyllosilicates can (1) enhance anisotropy and reduce shear strength, (2) modify porosity and permeability, (3) store or release significant volumes of water, and (4) increase fluid pressures during shearing. The varying interplay between faulting, fluid migration, and hydrous clay mineral transformations along the central Alpine Fault of New Zealand is suggested to constitute an important weakening mechanism within the upper section of this crustal discontinuity. Well-developed zones of cataclasite and compacted clay gouge show successive stages of hydrothermal alteration, driven by the cyclic, coseismic influx of meteoric fluids into exhumed amphibolite-facies rocks that are relatively Mg rich. Three modes of deformation and alteration are recog-nized within the mylonite-derived clay gouge, which occurred during various stages of the fault’s exhumation history. Following initial strain-hardening and frictional melting during anhydrous cataclastic breakdown of the mylonite fabric, reaction weakening began with formation of Mg-chlorite at sub-greenschist conditions (<320 0 C) and continued at lo wer temperatures (<120°C) by growth of swelling clays in the matrix. The low permeability and low strength of clay-rich shears are suitable for generating high pore-fluid pressures during faulting. Despite the apparent weakening of the c . 6 km upper segment of the Alpine Fault, the upper crust beneath the Southern Alps is known to be actively releasing elastic strain, with small (<M 5) earthquakes occurring to 12 km depth. We predict that larger events will nucleate at c . 6–12 km along an anhydrous, strain-hardened portion of the fault.