This paper develops a modified quasi-3D theory and the mixed beam element model for static analysis of functionally graded beams. The modified quasi-3D theory encompasses two innovations. Firstly, the accurate distribution of transverse shear stress is derived from the differential equilibrium equation that describes the relationship between stresses, rather than the traditional one derived from geometric relations and constitutive equations. Secondly, the effect of distributed loads associated with transverse stretching deformation, a factor typically overlooked in the existing quasi-3D theory-based beam models, is involved. In the development of beam finite element model, the mixed variational principle is firstly utilized to formulate the model of a quasi-3D theory-based beam element, where generalized displacements and internal forces are treated as two types of independent field quantities. Two numerical examples are conducted to investigate the validity and accuracy of the proposed theory and beam element. Numerical results indicate that the proposed mixed beam element can accurately predict the stress distributions over the cross-section and produce accurate displacement solutions. Meanwhile, it is noted that the effect of distributed loads related to the transverse stretching deformation should be correctly considered in the analysis of functionally graded beams based on quasi-3D theory.