The relationships between cancellous bone apparent density, trabecular orientation, and stress are developed and a mathematical theory describing these relationships is proposed. The bone is assumed to be a self‐optimizing material. Using a continuum model, sufficient conditions are developed which ensure that, for a given stress encountered during normal activity, the theory will predict both trabecular orientation and apparent density. Using two special approaches, one based on optimizing strain energy density (stiffness) and the other on optimizing strength, the relationship between apparent density and stress is derived. This is the first time that a single theory has been advanced to predict both the orientation and apparent density of cancellous bone.