The Central American republic of Nicaragua's western margin is characterized by oblique subduction of the Cocos Plate, producing a volcanic are (DeMets, 2001). The arc sits in the Nicaraguan Depression (ND) a topographic and structural depression (McBirney and Williams, 1965) with active faulting and related seismicity (La Femina et al., 2002). The paleostress field in the backarc region is one of extension or transtension, and it appears to have rotated from NE-SW extension in the Pleistocene to E-W extension today (Weinberg, 1992). Shear caused by oblique subduction requires either accommodation in the forearc via ductile deformation (Bevis and Martel, 2001) or translation of a rigid forearc sliver (Fitch, 1972). GPS geodesy indicates forearc translation of ∼15 mm/yr northwestward along the coast (relative to the stable Caribbean plate), with a small trenchward component seen in the coastal sites (Turner, 2003; Turner et al., 2007). Annual GPS campaigns in 2006-2008 remeasured and expanded the geodetic network in Nicaragua to 29 sites. The new sites were installed on the margins of the ND and in an arc-normal transect north of Lago de Managua in order to characterize the transition between the translating forearc and the stable interior. This was augmented by analysis of seismicity and topography in Nicaragua. Results indicate that a shear zone ∼20 km wide under the modern volcanic arc accommodates forearc sliver translation.