On February 21, 1991, an M_S = 6.8 shallow earthquake occurred in the eastern Bering Sea in an area which previously has shown no significant seismic activity. The earthquake was located on the Bering Shelf close to the shelf edge, near one of the elongate basins (Zhemchug Basin) that follow the outer shelf. To better understand the causes of this unusual event, we relocated the earthquake and its aftershocks, determined its source mechanism and depth, and examined multichannel seismic observations of structures near the epicenter. The event was relocated from regional and teleseismic P and S arrival times using a nonlinear inverse technique, as were the 19 previous well‐recorded Bering Sea earthquakes in global catalogs (1964–1987). The 1991 mainshock epicenter was located on the western flank of Zhemchug Basin. The only four previous events with small (<1°) location errors relocated at the outer shelf near the Pribilof Islands. The focal mechanism for the 1991 event, determined by inversion of teleseismic, broadband body waves and centroid‐moment tensor data, shows oblique normal faulting with the T‐axis oriented north‐south. One nodal plane dips steeply to the northeast and strikes parallel to the basin axis, subparallel to faults that bound Zhemchug Basin. This earthquake may be due to slip on one of these normal faults, several of which are seen to offset young strata on a multichannel seismic line 30 km south of the earthquake. It has previously been suggested that the large canyons that cut the Bering Shelf and the adjacent outer‐shelf basins are fault controlled, but this event and its aftershocks provide the first strong evidence to support the hypothesis that these structures are currently active and produce earthquakes. Seismic activity along the Bering Shelf edge may provide a good explanation for felt reports of several large events in the 1800s that have so far been difficult to associate with interplate activity along the Aleutian trench or with any other seismically active structure.