Adding to what Evo posted from USGS -
A previous earthquake was in the same area 2 years ago - in this area called the Sumatran subduction zone -
http://neic.usgs.gov/neis/poster/2002/20021102.html
"The earthquake (November 2, 2002) occurred as a result of thrust-faulting on the boundary between the subducting Australian plate and the overriding Sunda block of the Eurasian plate. In the region of the epicenter, the Australian plate is moving about 6 cm/year in a northerly direction against the Eurasian plate. The direction of relative plate motion is oblique to the northwest trend of the plate boundary. Earthquakes such as that of November 2 accommodate the component of plate-motion that is perpendicular to the trend of the plate boundary. The component of plate-motion that is parallel to the trend of the plate boundary is mostly accommodated by strike-slip faulting in the interior of the island of Sumatra. The largest thrust-fault earthquakes in the Sumatran subduction zone in the last two centuries were that of 1833, which had a magnitude of 8.8-9.2, and that of 1861, which had a magnitude of 8.3-8.5."
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From Knight-Ridder News (Dec 26, 2004)
For decades, scientists say, tiny islands off the west coast of Sumatra have been sinking - an ominous sign that strain was building toward Sunday's great earthquake, which set off tidal waves that killed thousands of people.
Researchers don't yet know exactly what happened. But if previous giant quakes in the region are any guide, the one Sunday would have suddenly pushed up the ocean bottom by a yard or two, raising a bulge of water on the surface that rippled out in all directions.
The resulting waves, or tsunamis, would have been only a foot or so tall as they raced across the ocean at 500 to 600 mph.
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Dec. 27 (Bloomberg) -- The death toll rose to at least 12,300 after the world's most powerful earthquake in 40 years, off the Indonesian island of Sumatra, unleashed waves that flooded coastal towns from Thailand to India.
Yesterday's magnitude 9.0 quake, the fourth-largest in the world since 1900, caused waves as high as 10 meters (33 feet) to strike tourist resorts in Thailand, Malaysia and the Maldives. At least 4,448 people were killed in Indonesia, Agence France-Presse said, citing officials. Sri Lanka declared a state of disaster as about 4,300 were killed on the island.
"All round the numbers are going to rise for a couple of days,'' said Megan Chisholm, senior emergencies officer at CARE Australia, an aid organization with staff in most of the affected countries. "I don't think we'll really know the full extent of the damage for a couple of days yet, until access to all places is achieved.''
Freak waves may flood coastal cities in India for the next two days, said A.K. Shukla, head of the Indian Meteorological Department. As many as 200,000 may have lost their homes in Sri Lanka, President Chandrika Kumaratunga said.
"The power of this earthquake, and its huge geographical reach, are just staggering,'' said Carol Bellamy, executive director for the UN Children's Fund, in a statement. "Hundreds of thousands of children in coastal communities in six countries may be in serious jeopardy.''
In India at least 3,223 people are dead following the freak waves that hit the country's south coast, according to updated death tolls reported by the Press Trust of India. Unicef and other United Nations agencies are working with countries and are ready to respond where help is needed.