The Chamoli region, within the ∼700 km seismic gap of the seismically active region of the Central Himalaya, has been site of moderate sized earthquakes in recent past, viz. 1999 March 29 (Mb 6.3), 2005 December 14 (Mb 5.3), and very recently 2011 June 20 (M 4.6). To understand the process of earthquake generation in the region, we constrain earthquake distribution pattern and determine the crustal seismic wave velocity variation using local earthquake data recorded by the Kumaon-Garhwal Himalaya seismic network that was operated during 2005–2008. Also, we included aftershocks data from the 1999 Chamoli earthquake. We infer that the earthquakes are mainly clustered near the Munsiary Thrust marking the southern part of the Main Central Thrust zone and in depth, above the Main Himalayan Thrust. The Chamoli earthquake source region is characterized by low P-wave velocity (VP) and high VP/VS. This could be expression of possible presence of fluids because of metamorphic dehydration reaction by the underthrusting Indian crust. The released fluid percolates upwards into the brittle portion of the crust, reducing the fault zone friction leading to generation of crustal earthquakes.