Synthetic aperture radar interferometry (InSAR) is a powerful technique for quantifying the co- and postseismic deformation of large earthquakes at the Earth’s surface. However, surface deformation caused by small- to moderate-sized earthquakes is rarely revealed by InSAR because their coseismic slip occurs mostly at significant depths (> 5 km), with limited deformation on the Earth’s surface. In this work, we investigate the surface deformation associated with the Mw 5.4 May 28, 2016, Mihoub (Algeria) earthquake and its source parameters. Interferograms calculated from Sentinel-1 TOPSAR images of both ascending and descending orbits show that, despite its small size, the earthquake produced evident deformation on the Earth’s surface, suggesting that the coseismic slip took place at a relatively shallow depth. We model the coseismic displacement fields extracted from InSAR time series using Bayesian approaches in two stages: 1) we model the coseismic slip data using uniform slip on a single fault to constrain the fault parameters. 2) We explore a variable slip model with varying rakes on the discretized fault obtained in the first stage. The modelling results indicate that the earthquake was associated with a ~ 0.5 m shallow oblique reverse slip, mostly between depths of 1.5 and 4.5 km, on a NE–SW-trending and SE-dipping thrust fault, which is in good agreement with the focal mechanism solutions of the earthquake deduced from seismology. This study demonstrates that the multitemporal InSAR (MTI) method may constrain surface displacements when the coseismic interferograms of moderate- to small-sized earthquakes are noisy and hence difficult to unwrap. The newly identified seismogenic Mihoub fault has implications for seismic hazard assessment in northern Algeria.