A study was made to determine the relation between the damage caused by the earthquake of the 22nd of May, 1960, in Valdivia, Chile, and the geology of the city. A geologic map and an investigation of the damage was made. There was no evidence in the area of fault movements produced by the earthquake. The inundation of extensive areas of Valdivia and its environs are attributed more to compaction of Recent sediments than to a general sinking of the coast. Validivia is situated in the basin of the Rio Valdivia. The geologic formations that crop out there are composed of Pleistocene and Recent sediments. Six mapable units have been selected for the preparation of this report. The great part of the damage in the city of Validivia was caused by defective construction; nevertheless, the greatest damage is observed in areas where Unit QV 6, Recent alluvium or artificial fill, crops out. More detailed geologic studies should be made upon which to base construction and future planning. The studies should be complemented by drilling, gravimetric investigations, and soil studies.