Geochemical and petrologic studies on Paleogene basanites from the Carpatho-Pannonian region (Poiana Ruscă, Romania) and associated peridotite xenoliths provide information about the composition of the underlying lithosphere, the petrogenetic evolution of the magma and its mantle source, as well as the geodynamic significance of the igneous activity in a regional context. Major and trace elements as well as Sr– Nd isotopic ratios reveal an ocean–island basalt signature, interpreted as the derivation from an upper mantle source chemically similar to the European Asthenospheric Reservoir after low fraction partial melting. Due to estimated average mantle source temperatures and the absence of any subduction-related geochemical features, the igneous activity in Poiana Ruscă was apparently triggered by adiabatic decompression melting, as postulated for similar and nearly coeval alkaline rocks in eastern Serbia. Differentiation processes within the Poiana Ruscă magmatic suite initially resulted from removal of mainly olivine, followed by olivine+clinopyroxene fractional crystallization. The spinel-lherzolitic to harzburgitic composition of the mantle fragments point to 2–30% fractional melting at a depth of approx. 70 km. Petrographic and geochemical investigations indicate both cryptic and modal metasomatism related to the influence of both alkaline-rich silicate and alkaline-rich hydrous silicate melts rather than subduction-related fluids/melts.