The 1886 eruption of Mt. Tarawera, in the Taupo Volcanic Zone of New Zealand, caused significant changes in the hydrothermal system in the vicinity of the pre-eruption Lake Rotomahana. In particular, the world-renowned Pink and White silica terraces disappeared from view. Our aim in this paper is to understand the general features of the pre-eruption Rotomahana hydrothermal system, and how they changed as a result of the eruption to give rise to the manifestations of geothermal activity seen in the area today.We present a numerical model of the heat and water flow in the pre-eruption hydrothermal system sur-rounding and beneath 'old' (pre-1886) Lake Rotomahana. The model uses a simplified geological structure combining an upper-2 km of volcaniclastic cover and -1 km of underlying basement material into a single geological unit, in addition to a second unit representing the morphological boundary of the Okataina Volcanic Centre (OVC).Results from the model suggest that at least part of the present-day geothermal heat source, as inferred from recent MT and seismic imaging, was active prior to the eruption in 1886. Only models where this heat source is confined to the area to the north-west of the lineation that extends from Mt. Tarawera to Waimangu valley can satisfactorily reproduce the main features of the Pink and White Terraces hydrothermal systems.The morphological boundary of the OVC appears to be a major geological control on fluid circulation within the pre-1886 Rotomahana hydrothermal system. If the permeability of this boundary is reduced with respect to that of the surrounding material, separate geothermal upflows occur on each side of it which broadly match the locations and separation of the Pink and White Terraces and their respective hydrothermal systems. The simu-lations further suggest that the Terraces may have been only 3-4,000 years old at the time of the eruption of Mt. Tarawera.