Studies conducted in present-day magma-poor rifted margins reveal that the transition from weakly thinned continental crust (∼30 km) in proximal margins to hyper-extended crust (≤10 km) in distal margins occurs within a narrow zone, referred to as the necking zone. We have identified relics of a necking zone and of the adjacent distal margin in the Campo, Grosina and Bernina units of the fossil Alpine Tethys margins and investigated the deformation and sedimentary processes associated with extreme crustal thinning during rifting. Within the basement rocks of the necking zone, we show that: (1) Grosina basement represents pre-rift upper/middle crust, while the underlying Campo unit consists of pre-rift middle/lower crust that was exhumed and cooled below ∼300°C by ca. 180 Ma, when rifting started to localize within the future distal margin; (2) the juxtaposition of the Campo and Grosina units was accommodated by the Eita shear zone, which is interpreted as a decollement/decoupling horizon active at mid-crustal depth at 180–205 Ma; (3) the Grosina unit hosts a large-scale brittle detachment fault. Our observations suggest that crustal thinning, accommodated through the necking zone, is the result of the interplay between detachment faulting in the brittle layers and decoupling and thinning in ductile quartzo-feldspatic middle crustal levels along localized ductile decollements. The excision of ductile mid-crustal layers and the progressive embrittlement of the crust enables major detachment faults to cut into the underlying mantle, exhuming it to the seafloor. This structural evolution can explain the first-order crustal architecture of many present-day rifted margins.