Neotectonics play an important role in the formation of lakes, especially near active suture zones. The best suited areas where such changes are observed are the tectonically active mountainous regions of Himalaya. However, in an inaccessible terrain like Higher-Himalaya, active tectonic studies related to development of newer and reactivated faults are less conceived. In this article, an attempt has been made to identify active faults and Neotectonic activity in the Tso Morari area in Ladakh, North-West Himalaya, with the help of remote sensing and digital elevation model (DEM) techniques. The results suggest that Tso Morari Lake is developed due to Neotectonic uplift in the region which created a fault scarp in E–W direction. The horizon blocking technique with the aid of elevation, slope and aspect map is used to demarcate the E–W trending younger fault. Moreover, the earthquakes foci also lie along this E–W direction which has restricted the seismic activity to its southern part.