A joint hypocenter-velocity inversion for the eastern Tennessee seismic zone (ETSZ) has resolved velocity features in basement rock below detached Appalachian thrust sheets. P and S wave arrival times from 492 earthquakes have been inverted for one- (1-D) and three-dimensional (3-D) velocity models to midcrustal depths. The 3-D P and S wave velocity solutions are computed independently and are very similar. In relation to the 1-D model, velocity anomalies range from-8% to +16% in the first layer (upper 5 km) and between ¿7% in deeper layers. Prominent velocity anomalies parallel the seismic zone and are consistent from layer to layer. The most persistent anomaly is a low-velocity region that borders the seismic zone to the northwest and is flanked on either side by regions of anomalously high velocity. The New York-Alabama (NY-AL) magnetic lineament coincides with or lies close to the southeast boundary of the prominent velocity low in both the P and S wave velocity images. The spatial coincidence between velocity, gravity, and magnetic gradients suggests that major discontinuities are present in the basement. Relocation in the 3-D velocity model reduced the number of very deep earthquakes (below 20 km) and further accentuated differences in seismogenic properties on either side of the NY-AL lineament. After relocation, most earthquakes occur in a vertically bounded region roughly 30 km wide extending from 4 to 22 km in depth. Most earthquakes occur in regions characterized by either average velocity or small velocity anomalies. ¿ 1998 American Geophysical Union