A failure prediction methodology that can predict sheet metal failure under arbitrary deformation histories including rotating principal stretch directions and bending/unbending with consideration of damage evolution is reviewed in this paper. An anisotropic Gurson yield criterion is adopted to characterize the effects of microvoids on the load carrying capacity of sheet metals where Hill’s quadratic anisotropic yield criterion is used to describe the matrix normal anisotropy and planar isotropy. The evolution of the void damage is based on the growth, nucleation and coalescence of microvoids. Mroz’s anisotropic hardening rule, which was proposed based on the cyclic plastic behavior of metals observed in experiments, is generalized to characterize the anisotropic hardening behavior due to loading/unloading with consideration of the evolution of void volume fraction. The effects of yield surface curvature are also included in the plasticity model. Here, the Marciniak-Kuczynski approach or the initial imperfection approach is employed to predict failure/plastic flow localization by assuming a slightly higher initial void volume fraction inside randomly oriented imperfection bands in a material element of interest. The failure of sheet metals is reached when plastic localization becomes possible under a given deformation history. Applications of the failure prediction methodology to predict the sheet metal failure in a fender forming process and biaxial stretching processes with pre-bending/unbending are reviewed.