A general theory for the role of intermittently imposed stresses in the differentiation of mesenchymal tissue is presented and then applied to the process of fracture healing. Two- and three-dimensional finite element models of a healing osteotomy in a long bone were generated and the stress distributions were calculated throughout incremental stages of healing under various loading conditions. These calculations were used in formulating theoretical predictions of tissue differentiation that were consistent with the biochemical and morphological observations of previous investigators. Thus, the progressive ossification process in the fracture callus in a long bone was emulated. Specifically, the analyses could be used to predict the zones of initial ossification, periosteal bone deposition, bone bridging, and finally bone consolidation. The results suggest that intermittent hydrostatic (dilatational) stresses may play an important role in influencing revascularization and tissue differentiation and determining the histomorphological patterns of fracture healing.