Following the Caledonian orogeny, large scale ESE–WNW extensional faulting and N–S directed sinistral wrenching affected East Greenland leading to the initiation of the Devonian basin. The NNE–SSW trending extensional faults have very large downthrows to the east exceeding 10 km and separate up to 90 km wide fault blocks, which during deformation were tilted approximately 12°. The tilting of one of the fault blocks led to uplift of deep-seated hot crystalline rocks in the eastern part causing contact metamorphism in the adjacent downfaulted block to the east. Based on K-Ar cooling ages, the faulting seems to have taken place during the Middle Devonian around 385 Ma, coinciding with the initiation of deposition within the Devonian basin. A N–S trending sinistral wrench fault zone developed in addition to the extensional faults leading to formation of synthetic and antithetic Riedel shears along the present-day western border of the Devonian basin. The timing of the wrench displacement cannot be younger than Middle Devonian. The extension faults and the wrench fault can be followed as regional structures in East Greenland and can be compared to similar Devonian extensional structures in northern Great Britain and to the major wrench faults in Scotland. No clear separation in time is possible between the extension and the wrenching, and a transtensional kinematic history is the most plausible. The basin-forming tectonic evolution in East Greenland during Middle Devonian can be related to an extensional collapse of an overthickened Caledonian crustal welt associated with wrench deformations due to late Caledonian shear displacements along plate boundaries. This evolution is analogous to the Devonian basin formation in northern Great Britain.