In Part I we reported the results of linear finite element models of the proximal femur generated using geometric and constitutive data collected with quantitative computed tomography. These models demonstrated excellent agreement with in vitro studies when used to predict ultimate failure loads. In Part II, we report our extension of those finite element models to include nonlinear behavior of the trabecular and cortical bone. A highly nonlinear material law, originally designed for representing concrete, was used for trabecular bone, while a bilinear material law was used for cortical bone. We found excellent agreement between the model predictions and in vitro fracture data for both the onset of bone yielding and bone fracture. For bone yielding, the model predictions were within 2 percent for a load which simulated one-legged stance and 1 percent for a load which simulated a fall. For bone fracture, the model predictions were within 1 percent and 17 percent, respectively. The models also demonstrated different fracture mechanisms for the two different loading configurations. For one-legged stance, failure within the primary compressive trabeculae at the subcapital region occurred first, leading to load transfer and, ultimately, failure of the surrounding cortical shell. However, for a fall, failure of the cortical and trabecular bone occurred simultaneously within the intertrochanteric region. These results support our previous findings that the strength of the subcapital region is primarily due to trabecular bone whereas the strength of the intertrochanteric region is primarily due to cortical bone.