Triaxial compression experiments were performed on samples of natural granular fault gouge from the Lopez Fault in Southern California. This material consists primarily of quartz and has a self-similar grain size distribution thought to result from natural cataclasis. The experiments were performed at a constant mean effective stress of 150 MPa, to expose the volumetric strains associated with shear failure. The failure strength is parameterized by the coefficient of internal friction ??, based on the Mohr-Coulomb failure criterion. Samples of remoulded Lopez gouge have internal friction ??=0.6??0.02. In experiments where the ends of the sample are constrained to remain axially aligned, suppressing strain localisation, the sample compacts before failure and dilates persistently after failure. In experiments where one end of the sample is free to move laterally, the strain localises to a single oblique fault at around the point of failure; some dilation occurs but does not persist. A comparison of these experiments suggests that dilation is confined to the region of shear localisation in a sample. Overconsolidated samples have slightly larger failure strengths than normally consolidated samples, and smaller axial strains are required to cause failure. A large amount of dilation occurs after failure in heavily overconsolidated samples, suggesting that dilation is occurring throughout the sample. Undisturbed samples of Lopez gouge, cored from the outcrop, have internal friction in the range ??=0.4-0.6; the upper end of this range corresponds to the value established for remoulded Lopez gouge. Some kind of natural heterogeneity within the undisturbed samples is probably responsible for their low, variable strength. In samples of simulated gouge, with a more uniform grain size, active cataclasis during axial loading leads to large amounts of compaction. Larger axial strains are required to cause failure in simulated gouge, but the failure strength is similar to that of natural Lopez gouge. Use of the Mohr-Coulomb failure criterion to interpret the results from this study, and other recent studies on intact rock and granular gouge, leads to values of ?? that depend on the loading configuration and the intact or granular state of the sample. Conceptual models are advanced to account for these descrepancies. The consequences for strain-weakening of natural faults are also discussed. ?? 1994 Birkha??user Verlag.