A numerical approach to simulate the behaviour of timber shear walls under both static and dynamic loading is proposed. Because the behaviour of timber shear walls hinges on the behaviour of the nail connections, the force-displacement behaviour of sheathing-to-framing nail connections are first determined and then used to define the hysteretic properties of finite elements representing these connections. The model nails are subsequently implemented into model walls. The model walls are verified using experimental results for both monotonic and cyclic loading. It is demonstrated that the complex hysteretic behaviour of timber shear walls can be reasonably represented using model shear walls in which nonlinear material failure is concentrated only at the sheathing-to-framing nail connections.