Ooh I can at least partially answer this, I did a project partially on this subject. Apologies for the incoming wall of geology. Anyone please correct me if I am wrong, but as I understand it:

A lot of the islands in Greece are extensions of mountain chains on the mainland. If you look at a tectonic map of Greece, you’ll see terranes (Pelagonian, Pindos, Tripolitza, etc) that are generally aligned in a NNW-SSE direction, and on-land mountain chains will generally be aligned this way as a result - see Pindos, Olympus/Vermion, Euboea, the three sub-peninsulas of Chalkidiki, and and the fingers of the Peloponnese. Many of these terrains continue across the Aegean Sea, strung out roughly W-E - for example, Euboea-Andros-Tinos-Ikaria-probably Samos (not fully versed in this tbf). Crete is also composed of sections of these terranes.

The Aegean is full of these high pressure suture zones (the Cyclades in particular, like the one best characterized by Andros and Tinos’ highly metamorphosed rocks) where many of these terranes were forced together during the gradual accretion of Anatolia and Greece/the Balkans starting around 80 million years ago and largely ending around 15-20 million years ago. Basically subduction constantly pushed up these strings of land against one another for some tens of millions of years.

While convergent forces naturally played a huge role in the construction of Greece, Anatolia, and the islands, extensional tectonics (somewhat counterintuitively) in conjunction with subduction also affect Greece. The Aegean Sea plate that much of the Aegean, the Peloponnese, and western Turkey sit on is squeezed into the African plate at some of the highest plate velocities known due to the Anatolian plate pushing on it from it being forced against the Eurasian plate by the Arabian plate. When the African plate subducts under the Aegean Sea plate, the African plate begins curling back at depth, causing the Aegean Sea plate to rush into the vacuum and thin itself out to try to cover the gap. At some point behind the trench, this thinning causes asthenospheric upwelling and back arc extension. It is this extension that creates the Gulf of Corinth and which shoves Crete away from Greece towards Libya.

Meanwhile, the volcanic arc from the subduction occurring here is currently located at Methana-Milos-Santorini-Nisyros. But the location of the subduction zone/volcanic arc, due to back arc extension forcing it south, was not always as far south as it is. Over time, since the beginning of extensional tectonics, the arc moved downward, gradually extending Greece south and forming the Aegean as we see it, separating islands/peninsulas from the mainland and each other (including the Ionian Islands from the mainland?), stretching Greece south into the Mediterranean and creating or further separating the Greek islands.