The geology of the Orkney Islands is dominated by well-studied Devonian sedimentary rocks deposited in the Orcadian basin. However, on the islands of Mainland Orkney and Graemsay there are small, relatively poorly studied outcrops of the underlying basement. Based on comparison with rocks in mainland Scotland this basement has been suggested to comprise pre-Caledonian para-gneisses and Caledonian granites. This has, however, never been documented. Here the contact relationships in the basement have been documented and through geochronological, geochemical and structural geologic studies the Caledonian tectono-magmatic history of the Orkneys is unraveled. Two granites intruded the metasedimentary gneiss at 431± Ma and 430± Ma, during the Scandian phase of the Caledonian Orogeny. Inherited zircon grains in the granites, most likely derived from the host rock, give ages that are typical of Moine schist. Both the granite and gneiss are observed to be cut be mylonite zones, later overprinted by phyllonites and brittle faults. In total, three shear zones are observed, all overprinted by phyllonites and brittle faults: a northern one at Yesnaby showing top-to-the-north sense of shear and two southern ones at Stromness and Graemsay showing top-to-the-south sense of shear. Above the basement complex east of Stromness an intraformational rhyolite occurring in the basal Devonian Hara Ebb formation date the onset of Devonian deposition and probably initiation of the Orcadian basin at 390,±0.41 Ma. The Hara Ebb formation contains clasts of the local granites and gneisses, showing that the Orkney basement was exposed during its formation. Based on these new results I present a model for the tectono-magmatic evolution of the Orkneys summed up by: 1) initial formation of high Ba-Sr melts due to slab breakoff during the start of continental collision and melt ascension through crustal scale shear zones associate with the Great Glen Fault system; 2) intrusion of granites into gneisses (probably of the Moine Group) in a pull-apart strike-slip setting controlled by large scale movement on the Great Glen Fault and an associated more local Riedel shear zone; 3) progressive exhumation of the basement on shear zones and subsequently brittle faults; 4) uplift of the basement above sea level before eruption of the subaerial Quoyelsh rhyolite at ca. 390 Ma; 5) probable initiation of the Orcadian basin marked by eruption of the intraformational Quoyelsh rhyolites at the base of the Hara Ebb Formation.