AbstractWe present a multiscale method that couples atomistic models with continuum mechanics. The method is based on an overlapping domain‐decomposition scheme. Constraints are imposed by a Lagrange multiplier method to enforce displacement compatibility in the overlapping subdomain in which atomistic and continuum representations overlap. An efficient version of the method is developed for cases where the continuum can be modelled as a linear elastic material. An iterative scheme is utilized to optimize the coupled configuration. Conditions for the regularity of the constrained matrices are determined. A method for computing strain in atomistic models and handshake domains is formulated based on a moving least‐square approximation which includes both extensional and angle‐bending terms. It is shown that this method exactly computes the linear strain field. Applications to the fracture of defected single‐layer atomic sheets and nanotubes are given. Copyright © 2006 John Wiley & Sons, Ltd.