This study is focused on geomechanics of rock formations containing discrete fracture networks (DFN). The first part of research deals with modelling of coupled hydro-mechanical response. An enhanced form of Darcy’s law is employed based on volume averaging of the fluid pressure gradient within the referential volume adjacent to the fracture. This is supplemented by a constitutive stress-strain relation in rate form that incorporates an embedded discontinuity approach. The formulation is illustrated by a numerical study involving plane strain compression of sparsely fractured dry and fully saturated samples of Lac du Bonnet granite. The finite element framework incorporates a coupling between the equivalent hydraulic and mechanical properties in the weak statement of the governing field equations [1]. The simulations take into account the pre-existing fractures as well as the onset and propagation of new macrocracks. The follow up topic deals with the assessment of equivalent permeability, and its stress-induced evolution, in fractured rock mass. A procedure is proposed for specifying the eigenvectors/eigenvalues of permeability tensor based on the notion of a fabric tensor. The approach involves a series of mesoscale simulations of fluid flow for a given deterministic fracture network and determining the best-fit approximation to the spatial distribution of directional permeability that represents a scalar fabric descriptor. In order to specify the stress-induced evolution law for the permeability tensor, a set of ‘virtual data’ is generated based on a mechanical analysis that accounts for the changes in fracture aperture and the onset/activation of new fractures. The proposed evolution law relates the principal directions of permeability operator to those of the stress tensor through a polynomial expression that incorporates the value of the failure function as an independent variable. The failure function itself accounts for the anisotropy in strength due to the presence of discrete fractures. The results of a numerical study are presented for a fracture pattern mapped from the south-west region of the Bristol Channel Basin. The analysis involves first the specification of the equivalent permeability operator at the stage prior to loading. Subsequently, the evolution law is examined, which involves assessment of the spatial distribution of directional permeability at different load intensities.