Earth fissures are approximately vertical cracks in the ground. They are caused by natural events such as earthquakes or by human activities such as groundwater level decline due to pumping. The latter has become a major worldwide issue in areas where groundwater is pumped for domestic, agricultural, and industrial use. Various theories, mostly conceptual, have been proposed to describe the formation of earth fissures due to groundwater level decline. Here a new theory is proposed for earth fissure formation in an unconfined aquifer based on fundamental soil mechanics principles, continuum mechanics, and fluid flow in porous media. This theory shows that the most efficient mechanism for earth fissure formation is a combination of bending and shearing. An earth fissure can form at the surface and propagate downwards or it can form beneath the surface and propagate upwards. The cause of earth fissure formation in the sediments within the aquifer differs from that of sediments above the aquifer. Earth fissures are initiated in aquifer sediments from bending and shear failure on vertical planes. Earth fissures are initiated in the sediments above the aquifer when the shear strains cause the soil to fail along vertical planes. Geological discontinuities are the preferred location for the formation of earth fissures. The findings from this model are in contrast to current conceptual models, which are based on tensile strains observed in existing earth fissures.