Structural analysis and paleostress fault slip inversion of the Transylvanian basin and its border regions with the surrounding East and South Carpathians and the Pannonian basin (e.g., the Apuseni Mountains) reveal at least two distinct tectonic phases for the Neogene evolution for the eastern part of the Pannonian basin system. Our main focus is on the role of the Transylvanian basin and its border regions in the Neogene as a transition zone between the extending Pannonian basin and the converging East and South Carpathians. The results provide constraints on the mechanisms responsible for as well the formation of the Transylvanian basin itself as on the relation between the basin-formational processes operating in the Pannonian basin and the contractional history of the East and South Carpathian mountain belt. In the middle Miocene (17--14/12 Myr) the Transylvanian basin underwent E-W extension coeval with the first and major phase of overall E-W extension affecting the Pannonian basin and with submarine accretionary wedge tectonics in the East Carpathian arc. In the late Miocene to early Pliocene (12--8/6 Myr) the Transylvanian basin experienced a strong pulse of E-W oriented shortening coeval with the climax of compression in the East Carpathians and a second rift phase affecting the Pannonian basin. Continued contractional deformation affected the Transylvanian basin during the Pliocene and Pleistocene with compression directions shifting to ESE-WNW directions.