A finite element model is developed to predict the stress-strain behaviour of particulate composites with fully unbonded filler particles. This condition can occur because of the lack of adhesion property of the filler surface. Whilst part of the filler particle is separated from the matrix, another section of filler keeps in contact with the matrix because of the lateral compressive displacement of the matrix. The slip boundary condition is imposed on the section of the interface that remains closed. The states of stress and displacement fields are obtained. The location of any further deformation through crazing or shear band formation is identified. A completely unbonded inclusion with partial slip at a section of the interface reduces the concentration of the stress at the interface significantly. Whereas this might lead to slightly higher strength, it decreases the load transfer efficiency and stiffness of this type of composite.