A deformation measurement system based on the principles of digital image correlation (DIC) has been developed to evaluate the process of slip along frictional discontinuities. A biaxial compression apparatus is used to impose shear failure on perfectly mated gypsum specimens with nonhomogeneous contact surfaces. The contact surfaces are made by casting gypsum against flat surfaces with different frictional characteristics and consisted of a smooth surface with low frictional strength on the upper half and a rough surface with high frictional strength on the lower half. Design, implementation, and verification of the DIC measurement system are presented in this paper. DIC successfully identified slip as a jump in the displacement field across the discontinuity. Slip is observed to initiate from the smooth surface with minimum frictional resistance and as the shear load is increased, propagates to the rough surface that has higher frictional resistance. DIC clearly exhibits a reduction in fracture’s shear stiffness based on an increase in the rate of relative vertical displacement across the discontinuity, which initiates from the smooth surface and propagates to the rough surface.