The hypocentral distribution of locally recorded aftershocks of the great (Ms=8.1) Michoacan, Mexico, earthquake of September 19, 1985, defines a narrow Wadati‐Benioff zone structure, roughly 10 km thick, dipping 14° at N23°E. This is in good agreement with the source geometry obtained by waveform modeling of the 1985 Michoacan mainshock and the large 1979 Petatlán earthquake in the adjoining region. We inverted for the crustal velocity structure in the epicentral region by applying the Levenberg‐Marquardt non‐linear least squares algorithm to our local aftershock data. The velocity model consists of a layer with linearly increasing velocity in depth overlying a dipping, constant velocity halfspace. Our hypocentral location program uses a velocity model of the same form together with ray tracing. The earthquake hypocentral resolution obtained with this program is significantly better than that from conventional approaches (HYPO) and looks very promising for use in velocity structures with an important dipping interface like subducti