J-integral resistance curves, determined from curved compact specimens of irradiated Zr-2.5Nb, show an unusual three-stage behavior. Immediately after initiation of stable crack extension, the crack growth resistance increases at a low rate, followed by a second stage in which the J-resistance (J_R) curve rises relatively steeply. Finally, the J-resistance curve decreases its slope, eventually reaching an approximately constant (zero slope) value. To explain this behavior, a series of compact specimens were pulled to various stages of crack extension and carefully examined using metallographic techniques and scanning electron fractography. The authors conclude that the decrease in crack growth resistance due to irradiation is a consequence of shear localization behavior, and the three-stage J_R curve is attributed to an abrupt transition from plane-strain conditions to the development of very flat shear lips. This peculiar shear-lip formation is shown to be a consequence of strain localization behavior.