Based upon the deep seismic sounding profiles carried out in the Tengchong Volcano-Geothermal Area (TVGA), western Yunnan Province of China, a 2-D crustal P velocity structure is obtained by use of finite-difference inversion and forward travel-time fitting method. The crustal model shows that a low-velocity anomaly zone exists in the upper crust, which is related to geothermal activity. Two faults, the Longling–Ruili Fault and Tengchong Fault, on the profile extend from surface to the lower crust and the Tengchong Fault likely penetrates the Moho. Moreover, based on teleseismic receiver functions on a temporary seismic network, S-wave velocity structures beneath the geothermal field show low S-wave velocity in the upper crust. From results of geophysical survey, the crust of TVGA is characterized by low P-wave and S-wave velocities, low resistivity, high heat-flow value and low Q. The upper mantle P-wave velocity is also low. This suggests presence of magma in the crust derived from the upper mantle. The low-velocity anomaly in upper crust may be related to the magma differentiation. The Tengchong volcanic area is located on the northeast edge of the Indian–Eurasian plate collision zone, away from the eastern boundary of the Indian plate by about 450 km. Based on the results of this paper and related studies, the Tengchong volcanoes can be classified as plate boundary volcanoes.