The footwall of a normal fault in the North D'Aguilar block in eastern Australia contains blueschist blocks within a sperpentinite matrix melange. The melange contains mass-flow deposits and was derived by erosion and redeposition of oceanic lithosphere exposed on the ocean floor by faulting. In mid-Carboniferous time, the melange was metamorphosed in the epidote-blueschist facies, mylonitized, and underplated to the hanging-wall of a subduction zone. An S-type granitoid, intruded at ~306-307 Ma, was probably derived by partial melting of subducted metasediments during the peak of a greenschist facies overprint that accompanied tranposition of an early high-P/low-T fabric. Mylonitic rocks below the normal fault absorbed a component of top-to-the-west simple shear related to movement on that originally west dipping fault, and resulted in juxtaposition of very low-grade accretionary sequences above polydeformed blueschists in a metamorphic core complex. At deeper levels in the footwall of the fault, bulk deformation was approximately irrotational. Later, the low-angle fault was folded, and its displacement was transferred westward into a more planar fault splay. The juxtaposition of high-P serpentinite melange against upper plate rocks probably reflects the mechanical weakness of serpentinite in deformed oceanic sequences, and the role serpentinite plays in strain softening that concentrates deformation along major extensional shear zones. ¿ American Geophysical Union 1993