We address the physical conditions which control the style of continental extension. Geological evidence suggests that once lithospheric scale zones of localized deformation have been formed, they strongly affect continental deformation. It is the purpose of this paper to investigate mechanisms which may cause lithospheric scale faults to initiate in stable continental lithosphere which is laterally fairly homogeneous. Faults and shear zones cutting strong layers in the lithosphere will have a very significant influence on the evolution during extension. Based upon experimental flow laws, a strength maximum can be expected in the mantle directly beneath the Moho. Strain localization in the shallow upper mantle is therefore expected to have a very pronounced effect on the evolution of the extending lithosphere. Low viscosities in the lower crust decouple the crust mechanically from the upper mantle. Therefore causes for strain localization in the sub-Moho mantle must be found in the mantle itself. Two potential causes satisfying this requirement are boudinageing and strain weakening. We use thermal-mechanical finite element models which incorporate the elastic, visco-plastic, and viscous response of lithospheric rocks. The results of our model experiments suggest that boudins do not evolve during extension of continental lithosphere in most situations; only when the extension rate is fast relative to thermal reequilibration may homogeneous boudinage result. By its very nature, however, this type of boudinage cannot produce lithospheric scale faults. Our model results suggest that shear zones may evolve after strain weakening. However, the style of extension on the scale of the lithosphere is pure shear like because the shear deformation in localized zones is balanced; in most cases the shear zones occur in conjugate pairs. Initiation of lithospheric scale faults is concluded to be unlikely in stable and homogeneous lithosphere in interior parts of continental plates. ¿ American Geophysical Union 1995