If you want the RadTAbItems to be styled not to overlap each other at all:
You can define a Margin foe each item:
<Setter Property="Margin" Value="3,0" />
If, however, you want the SelectedItem to overlap the unselected item, you need to add some custom logic. For example you can handle the PreviewSelectionChanged() event like so:
sender, Telerik.Windows.Controls.SelectionChangedEventArgs e)
(e.AddedItems.Count != 0)
RadTabItem newSelectedItem = e.AddedItems
(e.RemovedItems.Count != 0)
RadTabItem oldSelectedItem = e.RemovedItems
Give this a try and let us know if it helps or if you need more info.
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