Drilling at Site 786, located in the center of the Izu-Bonin forearc basin, penetrated an apparently continuous section of middle Eocene/lower Oligocene volcaniclastic breccias and nannofossil oozes. Planktonic foraminiferal faunas underwent a gradual transition from relatively high-diversity middle Eocene through late Eocene tropical or warm-water assemblages to a cooler-water, less diverse assemblage during the early Oligocene. In the cosmopolitan benthic foraminiferal faunas, the major transition occurred during the early late Eocene. Middle Eocene benthic assemblages resembling the bathyal 'Lenticulina' fauna (characterized by Osangularia mexicana, Cibicidoides eocaenus, and several buliminid species) changed to an upper Eocene abyssal 'Globocassidulina subglobosa' fauna (characterized by Cibicidoides praemundulus, Globocassidulina subglobosa, Gyroidinoides girardanus, Oridorsalis umbonatus, and Siphonodosaria aculeata). Even though no large, abrupt faunal changes appear to have been associated with the assumed Eocene/Oligocene boundary, benthic species turnover continued through the late Eocene and into the early Oligocene. This resulted in a slightly lower diversity early Oligocene fauna dominated by three species: Laevidentalina sp., Bulimina jarvisi, and Gyroidinoides girardanus. The progression from a middle Eocene bathyal 'Lenticulina' fauna, rather than an abyssal 'Nuttallides truempyi' fauna, to an abyssal 'Globocassidulina subglobosa' fauna during the early late Eocene, suggests that a bathymetric deepening occurred at Site 786. Increased water depths may have resulted from tectonic subsidence.