How does plate tectonics make mountains or basins?

Movement of plates puts enormous stresses on the Earth's crust, both compressional stresses (pushing together) and extensional stresses (pulling apart).  If you imagine pushing a layer of silly putty together, it will thicken.  If you pull it apart it will thin.  When it is hot and under high pressure (such as in the roots of mountain ranges) the Earth's crust behaves a lot like silly putty.  The thickening of the silly putty is analogous to mountain building.  Mountain building is the result of Earth's crust thickening under compressional forces.  Where the Earth's crust is colder, it breaks instead of flowing like silly putty.  The breaks, with movement along them, are called faults.  The faults have the same effect of either causing the crust to thicken (if compressed), or thin (if extended).

In addition, stresses can cause the crust to buckle upwards or downwards (creating basins where sediments can sometimes become enormously thick).
 

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