The Gaw-Khuni Basin is located in the central part of the Sanandaj-Sirjan zone, on the northeastern margin of the Zagros orogen. This basin is one of the continuous zones of Sanandaj-Sirjan zone basins that is filled by Pliocene–Holocene sediments. The Gaw-Khuni Basin is surrounded by an en echelon to parallel arrangement of active faults in dextral strike-slip fault zones that indicate a right-step dilational stepover structure. The boundary faults of this basin are the Eastern and Western Gaw-Khuni, Ramsheh, and Nain-Dehshir faults. Earthquake distribution determined along the faults, dissection and displacement of Holocene sediments, and also the development of pull-apart basins filled with Holocene deposits along the faults confirm that these faults are active. The Gaw-Khuni stepover was formed during transtensional movements produced between two dextral strike-slip faults (Nain-Dehshir and Ramsheh). Also, the Gaw-Khuni pull-apart basin and the Eastern and Western Gaw-Khuni faults developed in a releasing step between the faults and grew in two directions during the time of their formation.