This paper presents a case study of the instability mechanisms, and the excavation sequence, re-qualification and reinforcement methods adopted to pass through a short segment of a nearly 2-km tunnel built as part of a new 55-km state highway in northern Turkey. The instability problems were encountered during tunnel excavation due to the failure to recognize the fact that alteration in stress field and resulting deformation could cause dilation and increase in the permeability of claystone-shale layers and local fault gouge zones, and in turn significant reduction in shear strength. Change in natural drainage pattern and capillarity exacerbated saturation and the consequent strength reduction. The 92-m 3 loose material flowed into the tunnel due to the collapse and caused 2.5 months of delay in completion of the tunnel. Longitudinal and oblique cracks observed in shotcrete were attributed to the reduction in modulus upon saturation, which caused a large cumulative deformation of approximately 110 mm at a section about 30 m behind the collapse face. It is concluded that early detection or prediction of potentially problematic zones (via probe drilling and monitoring) in tunnelling is of paramount importance, especially through mixed or difficult ground conditions characterized by alternating layers, folding, faulting and localized zones of high water pressure. Because mechanical detection methods cannot be fully relied upon, availability of experienced personnel to predict and deal with such instability problems effectively and promptly is the best insurance for successful completion of tunnelling contracts.