The axial tectonic belt is a belt of active deformation within the boundary zone between Indian and Pacific plates that crosses both North Island and South Island between subduction zones northeast and southwest of New Zealand. Shear strains determined from triangulation data within the axial tectonic belt on the east coast of North Island show variations in rate and direction that are related to the great 1931 earthquake of Hawke's Bay (province around Hawke Bay). This earthquake was associated with thrusting on a fault parallel to the axial tectonic belt and involved a shortening of about 2-3 m. Before the earthquake, shear strains showed a large component of compression normal to the belt and, after, a large component of extension. The Pacific plate is being subducted beneath the axial tectonic belt of North Island along a shallow dipping (about 12¿) thrust some 250 km wide from the trench to where the plate abruptly bends and plunges into the asthenosphere. It is suggested that (1) the compressional stage results from locking of the subduction thrust with plate movement accumulating as an elastic strain, (2) the earthquake is caused by rupturing of the locked zone, and (3) the following extension is a relaxation and gravitational spreading within the lithosphere above the thrust. In southern North Island a phase of extension normal to the axial tectonic belt occurred up to about 1920, since which time compression has been occurring. The onset of compression is believed to mark the locking of the subduction zone. Sufficient time has elapsed for the accumulated strain to be large enough to cause a mojor earthquake.