Hydraulic fracturing is a process of fluid injection, which creates tensile stresses in rock in order to overcome the tensile strength of the rock. In this study, a three-phase hydro-mechanical model is developed for simulating hydraulic fracturing. The three phases include: porous solid, fracturing fluid and reservoir fluid. Two numerical simulators are coupled together to model multiphase fluid flow in fractured rock undergoing deformations, ranging from linear elastic to large, non-linear inelastic deformations. The fluid flow model involves solving the Navier–Stokes equations using the finite-volume method. The flow model is coupled with the geomechanics model to simulate the interaction between fluid flow inside the fractures with rock deformations. For any time step, the pore pressures from the flow model are used as input for the geomechanics model for the determination of stresses, strains and displacements. The strains derived from the geomechanics model are in turn used to calculate changes to the reservoir parameters that are fed as input to the flow model. This iterative process continues until both models are converged. A parametric study is conducted and the results show that changes in rock mechanical properties as well as fluid parameters could lead to significant changes in the hydraulic fracture propagation.