Land subsidence induced by water pumping has been occurring in several regions in Greece. One of the first noticed and studied examples is that of the Kalochori region. Kalochori village is located on the west side of Thessaloniki and is one of the main industrial centres of the central Macedonia region. The rapid development of the area during the last 45 years led to an increasing need of water, provided by productive wells. The overexploitation of the aquifers, enhanced by excessive water pumping by the Water Company of Thessaloniki, led to the development of surface subsidence, reaching, in several areas, maximum values of 3–4 m. The evaluation of the geological, geotechnical and hydrogeological setting of the wider Kalochori region as well as the historical background of the subsidence provided data that were used for the study of the subsidence by means of simulation using the finite-element method. The availability of the various geodetic records allowed cross-checking of the results and the carrying out of all necessary back-analyses, calibrating and evaluating the geotechnical parameters as well as the simulation model. Also, knowledge of the land-use distribution and the activities taking place in the wider Kalochori region helped in the interpretation of the subsidence and the detection of its causal factors.