Abstract In this work, finite element simulations of mixed-mode (Modes I and II) fracture initiation in a ductile alloy with a dual distribution of second-phase particles are carried out under plane-strain, small-scale yielding conditions. The background material is represented by the Gurson constitutive model and strain controlled micro-void nucleation at uniformly distributed small-size particles is taken into account. A rectangular distribution of large synthetic inclusions around the notch tip is considered and a stress controlled void nucleation law is used within the framework of Gurson model to trigger void initiation at these particles. Attention is focused on the formation of porosity at these synthetic particles located around the notch tip, their growth and interaction with the notch tip. It is found that when the inclusions have low nucleation stress, the critical value of J at fracture initiation decreases for deviation from pure Mode I. However, when the particles have high nucleation stress, the critical value of J shows an increase for deviation from pure Mode I.