Since July 1994 an unusually persistent swarm of earthquakes (M<4.0) has been in progress at the Hengill triple junction, SW Iceland. Activity is clustered around the center of the Hr¿mundartindur volcanic system. Geodetic measurements indicate a few centimeters uplift and expansion of the area, consistent with a pressure source at 6.5¿3 km depth beneath the center of the volcanic system. The system is within the stress field of the south Iceland transform zone, and the majority of the recorded earthquakes represent strike-slip faulting on subvertical planes. We show that the secondary effects of a pressure source, modeled as a point source in an elastic half-space, include horizontal shear that perturbs the regional stress. Near the surface, shear stress is enhanced in quadrants around the direction of maximum regional horizontal stress and diminished in quadrants around the direction of minimum regional stress. The recorded earthquakes show spatial correlation with areas of enhanced shear. The maximum amount of shear near the surface caused by the expanding pressure source exceeds 1 μstrain, sufficient to trigger earthquakes if the crust in the area was previously close to failure.¿ 1997 American Geophysical Union