Helmets are the most effective protective item for motorcyclists. The liner of the helmet is the part of the helmet which dissipates most of the impact energy and mitigates the risk of head injuries. It has been proposed that the helmet test standards should include assessment of the helmets for oblique impacts that is not currently addressed in the standards. A conventional uniaxial compression test method is still used for characterization of the helmet liner material. However, compressive tests of EPS foams provide reliable results for normal loading on EPS, but do not provide a realistic result for oblique impacts. Therefore, we carried out experimental tests to measure the response of EPS foams, which are commonly used for helmet liners, under biaxial loading. The result of our experiments show that the shear response of EPS foams is a function of axial compression, and increasing the axial strain leads to increased shear stiffness, and thus higher levels of shear stress. We also showed that including shear-stiffening of EPS in the FE assessment of helmets may change the headform rotational acceleration by 25%. Therefore, such behavior of EPS foams should be included in FE analysis of helmets in the case of oblique impacts for a more realistic assessment of their performance.