Peridotite denuded by tectonic extension and exposed at the seafloor adjacent to slow-spreading centers hosts hydrothermal circulation of seawater. The reaction of seawater with peridotite causes serpentinization, which generates a high-pH, strongly reducing fluid rich in methane and hydrogen, and is accompanied by as much as 40% volume expansion. Complete serpentinization of peridotite requires tectonic activity to open fluid paths sealed by volume expansion. Diffuse venting of serpentinization fluids causes lithification of calcareous ooze on the seafloor to chalk-like limestone. This may be the main mechanism of deposition of ophicarbonates common in ophiolites. The degree of induration is a function of the fluid flux through the sediment column. Calcareous ooze infiltrates faults and fractures and can be deformed following lithification. Focused venting of serpentinization fluids may lead to deposition of large chimneys composed of calcite, aragonite, and brucite, such as those in the recently documented Lost City vent field (30°N, Mid-Atlantic Ridge). Geophysical implications of serpentinization include (1) creation of magnetic anomalies due to growth of magnetite in serpentinite and (2) lowered seismic velocity. Integrated studies of geologic and geophysical effects of serpentinization may aid in a more complete understanding of the structure of oceanic lithosphere and the mechanisms that expose mantle peridotite at the seafloor.