The current geothermal and volcanic activity in the North Island of New Zealand is explained as a consequence of Pacific and Australian plate interactions over the last 20 million years. The primary hypothesis is that the Kermadec subduction zone has for the last 20 million years or more been retreating in a south-easterly direction at about five centimetres per year. It is surmised that this motion and interaction with another subduction zone almost at right angles to it under the North Island resulted in plate tearing due to the incompatibility of the plate geometry where these subduction zones interacted. The nature and consequences of this plate tearing are partially revealed in published maps of the plate currently under the North Island. If the subducted parts of this plate, as shown in Eiby’s maps, [G. A. Eiby, “The New Zealand sub-crustal rift”, New Zeal. J. Geol. Geophy.7 (1964) 109–133] are straightened, then the plate edge lies on a curve giving a rough picture of their position before being torn and subducted by the Kermadec trench motion. This map of the tear suggests the shape of the edge of a missing plate segment torn from the plate, and implies a rotation of the upper North Island, clockwise approximately 20 degrees, about a point just south of the Thames estuary. A consequence of this plate tearing is that the solid retreating crustal wave generating magma pressure beneath the crest of the solid wave has the potential to inject significant basaltic magma into the crust through the tears. These intrusive magma fluxes have the ability to generate geothermal fields and rhyolitic lavas from crustal melts. This could explain the geothermal activity along the Coromandel peninsula five to seven million years ago, the ignimbrite outcrops about Lake Taupo and the current geothermal and volcanic activity stretching from Taupo to Rotorua.