In the Early to Middle Miocene, a series of lakes, collectively termed the Dinaride Lake System (DLS), spread out across the north-western part of the Dinaride-Anatolian continental block. Its deposits, preserved in numerous intra-montane basins, allow a glimpse into the palaeoenvironmental, palaeobiogeographic and geodynamic evolution of the region. Lake Gacko, situated in southern Bosnia and Herzegovina, is one of the constituent lakes of the DLS, and its deposits are excellently exposed in the Gračanica open-cast coal-mine. A detailed study of the sedimentary succession that addresses facies, sediment petrography, geophysical properties, and fossil mollusc palaeoecology reveals repetitive changes in lake level. These are interpreted to reflect changes in the regional water budget. First-order chronologic constraints arise from the integration of radio-isotopic and palaeomagnetic data.