SUMMARY Conventional continuum damage descriptions of material degeneration suffer from loss of well-posedness beyond a certain level of accumulated damage. As a consequence, numerical solutions are obtained which are unacceptable from a physical point of view. The introduction of higher-order deformation gradients in the constitutive model is demonstrated to be an adequate remedy to this deficiency of standard damage models. A consistent numerical solution procedure of the governing partial differential equations is presented, which is shown to be capable of properly simulating localization phenomena.