The Carpathian‐Pannonian region has been characterized by a two‐stage tectonic evolution since the beginning of the Neogene. During early and mid‐Miocene the lateral eastward escape of the Pannonian Fragment caused thrusting and folding in the Outer Carpathian Mountains, south‐ and westward directed subduction of the Eurasian lithosphere, calc‐alkaline volcanism along the Inner Carpathian bend, and localized fault‐controlled subsidence of basins in the Pannonian region. This style of tectonic deformation ceased by the end of the mid‐Miocene. The neotectonic stage began in the late Miocene. It is characterized by differential regional subsidence with maximum rates in the west and east and minimum rates in the centre of the Pannonian Basin. Further characteristics of the central Pannonian Basin are the anomalous high heat flow values, the thin crust and lithosphere.The neotectonic stress field has been determined by in situ stress measurements, the analyses of borehole breakouts and fault‐plane solutions of earthquakes. In situ stress measurements by the doorstopper and triaxial strain cell methods indicate high compressional stresses in the western Pannonian Basin with its maximum in WNW‐ESE to NW‐SE direction. In contrast to its western part, the central Pannonian Basin shows tensional stresses near the Earth's surface with maximum tension in the same WNW‐ESE direction. Borehole breakout data indicate a general WNW‐ESE orientation of maximum horizontal stress in the western part of the Pannonian Basin and in the eastern part as well, whereas in the central Pannonian Basin this direction is the preferred azimuth of minimum horizontal stress.It is suggested that the neotectonic deformations and stresses in the Carpathian‐Pannonian region have a sublithospheric origin.Asthenospheric convection with an upwelling mantle flow below the centre of the Pannonian Basin and downwelling flows along the cold lithospheric roots below the eastern Carpathians and the Alps seems to be most plausible. Accordingly, the relative uplift of the centralPannonian Basin, the high heat flow and also the tensional stresses are explained as the surface expression of an upstreaming branch of a localized convection cell below the Pannonian Basin.