The critical conditions for void nucleation by particle debonding at a θ-particle in an aluminum matrix are identified through a comprehensive set of molecular dynamics simulations spanning a range of stress triaxialities and Lode parameter values. Specifically, it is determined that nucleation occurs when the local normal stress at the matrix–particle interface reaches a critical value of 8.14 GPa. When plasticity occurs in the matrix prior to nucleation, an additional plastic stress concentration is observed as a result of the plastic strain build up around the particle. Our results indicate that this plastic stress concentration factor increases roughly linearly with equivalent plastic strain, independent of triaxiality and Lode parameter. Comparing our results with the literature, we observe a much stronger influence of plastic strain than is predicted by continuum plasticity theory. We argue that this difference derives from the fact that nucleation is fundamentally driven by local stress hot spots resulting from the heterogeneity of plastic strain, while continuum theory is based on homogenized plastic strain fields. These results provide guidance for development of ductile fracture engineering models, while giving a warning regarding the use of continuum theory to predict damage initiation phenomena in metals.