This article assumes that the overall foundation shear damage happened, the sliding surtace damage is given, the greatest possible expansion extent of the soil plasticity balance area with the variety of foundation embedment is considered, and both sides of the foundation soil shear strength are taken into account. Circular shallow foundation bearing capacity is theoretically derived with Limit equilibrium method. Using practical engineering examples and numerical simulation with finite element program (ADINA), the correctness of shallow foundation damage model and theoretical derivation are further validated.