The Dunnage Mélange comprises a chaotic, heterogeneous assemblage of unsorted blocks set in a fine-grained matrix that is situated along the main Iapetus suture zone in Newfoundland Appalachians. The origin and tectonic setting of the mélange has been controversial and it has been variously interpreted as an olistostrome and a tectonic mélange that formed in arc–trench gap or backarc settings. The mélange preserves abundant evidence of tectonic and later soft-sediment deformation, indicating that tectonic deformation is a major component in the genesis of the Dunnage Mélange. The tectonic setting of the Dunnage Mélange is herein investigated through the Coaker Porphyry (469±4Ma), a peraluminous, syn-tectonic, plutonic suite that is exclusively emplaced into the mélange. The Coaker Porphyry contains a typically peri-Gondwanan inheritance indicating derivation from the adjacent Cambro-Ordovician Victoria–Penobscot Arc and its basement. The xenoliths contained in the Coaker Porphyry are indicative of an arc origin and there is no evidence for derivation from the Iapetus Ocean lithosphere. The mélange is thus interpreted to have formed above Victoria–Penobscot arc crystalline forearc basement. The emplacement of the Coaker Porphyry coincides with regional rift-like magmatism in the adjacent Victoria Arc. We interpret the mélange formation, rift-like magmatism and generation of Coaker Porphyry to be related to a Middle Ordovician ridge–trench collision, slab window formation and inversion of the forearc strata.