The existing seismological network in the Kangra–Chamba sector has been upgraded with 12 three-component digital seismometers to obtain new insight on the nature and sources of continued clustered seismicity in this part of northwest Himalaya. A combination of travel-time–distance plots and travel-time inversion of P and S phases have been used to derive a 1D velocity model for the region. The minimum 1D velocity model divides the average 44 km thick crust into four layers. The top ∼10 km thick layer represents the metamorphosed sediments of the Chamba nappe that dominates the surface geology of the study area. Suggestion of a thin low-velocity layer at 15 km depth possibly marks the detachment zone separating the downgoing Indian plate from the overriding wedge. The improved locations of epicenters show close clustering of seismic events immediately northeast of the epicenter of the 1905 Kangra earthquake, while away from this zone the seismicity in the Chamba sector has more even distribution. In the later sector, space-depth distribution of hypocenters suggests that strain resulting from the ongoing collision of the Indian plate with Asia is being consumed by reverse-fault movement on the Chamba thrust. The clustered seismicity in the Kangra sector has three distinct source regions and mechanisms: (1) southward displacement of the thick Chamba nappe sheet over the Panjal imbricate zone along the Panjal thrust accounts for the seismicity at shallow depths of less than 7 km, (2) the nucleation of strains where the northeast dipping main boundary thrust (MBT) merges with the detachment plane produces focused seismicity near this junction, and (3) the seismicity in a small pocket below the plane of detachment appears to be a consequence of stresses generated at the base of the northeast dipping detachment plane by the transverse structure.