SummaryThe paper develops the stiffness relationship between the movements and forces among a system of discrete interacting grains. The approach is similar to that used in structural analysis, but the stiffness matrix of granular material is inherently nonsymmetric because of the geometrics of particle interactions and of the frictional behavior of the contacts. Internal geometric constraints are imposed by the particles' shapes, in particular, by the surface curvatures of the particles at their points of contact. Moreover, the stiffness relationship is incrementally nonlinear, and even small assemblies require the analysis of multiple stiffness branches, with each branch region being a pointed convex cone in displacement space. These aspects of the particle‐level stiffness relationship give rise to three types of microscale failure: neutral equilibrium, bifurcation and path instability, and instability of equilibrium. These three pathologies are defined in the context of four types of displacement constraints, which can be readily analyzed with certain generalized inverses. That is, instability and nonuniqueness are investigated in the presence of kinematic constraints. Bifurcation paths can be either stable or unstable, as determined with the Hill–Bažant–Petryk criterion. Examples of simple granular systems of three, 16, and 64 disks are analyzed. With each system, multiple contacts were assumed to be at the friction limit. Even with these small systems, microscale failure is expressed in many different forms, with some systems having hundreds of microscale failure modes. The examples suggest that microscale failure is pervasive within granular materials, with particle arrangements being in a nearly continual state of instability.