Zones of deformation bands occur in unconsolidated late Pleistocene marine terrace sand in the footwall of the active McKinleyville thrust fault in Humboldt County, California. Individual deformation-band shear zones are as much as 8 cm wide and accommodate ∼50 cm of reverse-dip separation. Like deformation bands described in Mesozoic sandstone of the Colorado Plateau, these structures formed in fine-grained, well-sorted, porous sand. We assessed the relative importance of compaction, grain breakage, and grain rotation during shear-zone development by measuring grain size, grain shape, grain orientation, porosity, and bulk strain both within and outside deformation-band shear zones. Sand grains within shear zones are smaller, more compacted, and have stronger preferred orientations and more elongate shapes than grains outside of deformation-band shear zones. Bulk strain analyses of sand within shear zones give strain ellipses that are compatible with dextral shear strains of ∼0.1–0.5 and volume loss of 5%–15%. On the basis of these observations, we conclude that compaction, grain rotation, and extensive cataclasis all contribute to deformation-band shear-zone formation in these unconsolidated sands, despite very low confining pressures. In addition, the position of these deformation-band shear zones adjacent to an active fault with a history of episodic slip during large earthquakes suggests that they may form in conjunction with slip events.