By taking into account the continuity of stresses and pore pressure across the boundaries of a shear band, it is theoretically shown that incipient localization may take place in saturated loose contractive sand in the regime of decreasing deviator stress under undrained conditions. The undrained shear band orientation primarily depends on the Poisson's ratio and the dilatancy characteristics of the material. However, under strict isochoric constraint, localization is precluded in dense dilative sand with deviator stress increasing only. If any local volume change takes place with a certain mechanism, undrained shear band would be possible in dense sand, most likely in the regime of decreasing friction angle after the peak friction angle is mobilized. Numerical examples are given to demonstrate the variation of shear band inclinations with void ratios and initial consolidation pressures. Copyright © 2011 John Wiley & Sons, Ltd.