Microstructural investigations below the fracture surface have revealed that the rubber particles in a number of polymer-rubber blends were deformed into remarkable S-like shapes. These shapes seem to have been largely ignored in previous microstructural studies of blends, but in fact cannot be explained from the known deformation states around a crack. We hypothesize in this paper that these shape changes develop as a consequence of macroscopic shearing of the blend as the crack front sweeps through the material. Large strain, finite element models for simple shearing of a blend are reported which demonstrate the evolution of round particles into S-shape ones for a range of material parameters, and thus support our hypothesis. The 'microscopic' localized deformation processes are identified, and the implications for the toughening mechanism in these blends is discussed.