Despite a general understanding that bone microdamage has distinct strain dependent morphologies, very little information exists on how different damage morphologies develop and participate in bone fracture. In this study, cortical bone beams were subjected to the primary or tertiary phases of bending fatigue followed by either post-hoc fracture toughness tests or microdamage analysis to determine the sequence in which linear microcracks and diffuse damage form during bending fatigue and how they affect the propensity of bone to fracture. The results demonstrate that, following the primary phase, linear microcracks and diffuse damage are formed on the compressive and tensile sides, respectively (p < 0.05). Furthermore, this mode of damage formation results in a greater toughness loss if a fracture crack initiates from the tensile side rather than the compressive side (p < 0.05). Continued loading of bone specimens to the tertiary phase, however, leads to further accumulation of damage only on the compressive side (p < 0.05), and this mode of damage formation results in a further toughness loss if a fracture crack initiates from the compressive side rather than the tensile side (p < 0.05). Thus, cortical bone compartmentalizes the damage morphologies in different regions and the sequence of damage production in different phases of cyclic loading to dissipate energy and resist a catastrophic fracture.