It is known that the tip-clearance gap plays a pivotal role in determining the performance of an aero-engine compressor, both in terms of stability and pressure rise. However, the exact effect of tipclearance size on stall margin over the range of clearances experienced during engine operation is not known, and most designers substitute rules of thumb for real knowledge when developing new compressors. Eccentricity in the tip-clearance is also known to affect compressor performance, though again little work has been done to quantify the penalties. It is generally assumed that the stall margin of an eccentric machine will be approximately equal to that of a concentric machine with a clearance equal to the maximum eccentric clearance. Results given in this paper show a stabilising effect of the small tip-clearance sector of an eccentric compressor on the large tip-clearance sector, so the penalty on stall margin is not as large as commonly assumed. It is shown that the stall margin penalty in a single-stage eccentric machine is only 50-60% of that which a concentric compressor with clearance equal to the maximum clearance would exhibit. In addition, the effect of eccentricity is shown to diminish as the average clearance is increased. In this paper, experiments and computational modelling are used to examine the effects of eccentric tip-clearance on flowfield redistribution and compressor performance. In particular, the threedimensional nature of the flowfield generated by an eccentric gap is shown for the first time. The purpose of this work is not to provide 'hard-and-fast' design rules for eccentric compressors (this cannot be done on the basis of single-stage measurements), but to provide a starting point for a better physical understanding of the problem.