In this paper, experimental and numerical analysis is used to investigate the failure modes of dual phase steels under different loading paths. Numerical models are established for uniaxial tensile tests and stretch flanging tests. Special attention has been paid to the behavior of DP780 in stretch flanging tests with small die radius. The occurrence of shear fracture is identified by comparing numerical simulation results with test data. The study suggests that traditional theory of localized necking is feasible for DP780 under uniaxial tensile condition but invalid when it is undergoing stretch flanging tests with small radius.