Soil is a heterogeneous material and most natural soil deposits show a definite stratification. The mechanical behaviour of such material is generally different in different directions, especially in the direction parallel and perpendicular to the stratification. A series of isotropic compression tests were carried out to study the behavior of granular material produced under controlled stratification in the laboratory. These tests were conducted both on cylindrical and square prismatic tri-axial specimens. It was observed that for hydrostatic loading, the strain response was different in different directions, especially in directions parallel and perpendicular to the direction of soil deposition. A definite trend of anisotropy was observed in the deformation pattern. The observed anisotropy is modeled in this paper by treating soil-dilatancy as a variable quantity. The equation of the plastic potential surface of the model which obeys a non-associated flow rule, is assumed to be dependent on three main variables confining pressure ( $$\sigma_{3}$$ ), void ratio (e) and the angle of bedding plane orientation (δ) during deposition. The angle of bedding plane orientation (δ) was measured with respect to the direction of the major principal stress. The model has a cap yield surface in the isotropic stress direction, which is supplemented by a shear hardening Mohr–Coulomb surface in the deviator direction. This paper focuses on predicting the anisotropic strain response of stratified soil deposits subjected to isotropic compression. The proposed anisotropic model incorporates within an existing strain-hardening sand model, a modified cap yield surface and a modified plastic potential function related to the cap surface, to account for the anistropic response observed in isotropic compression tests. The two dimensional stress–strain model was extended to three dimensional Cartesian space. The strain anisotropy observed in the isotropic compression tests was predicted by the three dimensional anisotropic model proposed for granular materials.