The Alpine Fault accommodates around 60-70% of the 37 mm/yr oblique motion between the Australian and Pacific plates in the South Island of New Zealand. Uplift on the fault over the past 5 Ma has led to the exhumation of the deep-seated mylonite zone alongside the present surface trace. Shear strain estimates in the mylonites reach 200-300 in the most highly strained rocks, and provide an integrated displacement across the zone of 60-120 km. This is consistent with the amount of displacement during the last 5 Ma, suggesting that displacement on the fault is localised within a 1-2 km wide ductile shear zone to depths of 25-30 km. Existing geodetic data, together with Late Quaternary slip rate and paleoseismic data, are consistent with the steady build-up and release of elastic strain in the upper crust driven by ductile creep within a narrow mylonite zone at depth. Faults of the Otago Fault System form a parallel array east of the Alpine Fault and accommodate c. 2 mm/yr contraction. Long periods of quiescence on individual structures suggest episodic, or "intermittently characteristic", behaviour. This is more consistent with failure on faults within an elastico-frictional upper crust above a ductile lower crust. Localisation of crustal deformation may be initiated by inherited weaknesses in the upper crust, with downward propagation of slip causing strain weakening within the ductile zone immediately beneath. Inherited structures of great length focus a greater amount of displacement and hence more rapidly develop underlying zones of ductile shear.