We investigate the rupture process of the 26 January 2001 Bhuj, India, Mw 7.6 earthquake through inversion of teleseismic broadband body waves. This earthquake ranks as one of the most important recent events due to its occurrence within a stable continental interior, where such events are rare. The Bhuj earthquake occurred on a moderately dipping blind thrust fault within an ancient failed rift. About 70% of the seismic moment released in the earthquake was confined to a very small area (∼375 km2) surrounding the hypocenter and at depths below 12 km. The static stress drop of the Bhuj earthquake is anomalously high (∼20 MPa). The source time history of the event indicates very rapid onset to the moment release and most likely high slip velocities within the deep asperity. This suggests that some of the damage near the epicenter may have been caused by anomalously high-frequency ground motions. The teleseismic data also indicate the presence of a second area of large slip in the shallow part of the Bhuj fault, although the depth extent of this shallow large-slip area is not resolved. Comparisons of the predicted ground motions with observed intensities suggest that substantial slip occurred in the upper 10 km of the fault in order to explain the distribution of high intensities to the west and northwest of the fault. The upper surface layers near the Bhuj fault consist of unconsolidated, low-rigidity sediments and alluvium. The upper ∼ 10 km of the Bhuj fault may therefore be in a conditionally stable region that normally deforms through aseismic creep and can sustain seismic rupture only when dynamically stressed by rupture of the high-strength deep asperity. We suggest that this deep asperity may be related to a lithologic anomaly of ultramafic composition.