An advanced elasto-plastic finite element model adopting a modified Von Mises yielding criterion was used to simulate progressive failure of the rock strata surrounding a room and pillar mine structure. The model conformed to the strain-softening behaviour of rock and accounted for post-failure residual strength. The simulation was achieved in such a way that material values were updated after each FE run, according to the stress criterion until the solution reached the final equilibrium steady state of the mine structure. The suggested structural stability analysis approach accounted for the main features of the structure degradations produced during loading through changes in rock material stiffness and subsequent evolution of stresses. Comprehensive parametric analysis was performed and the inevitable effect of interaction of the roof, pillar and floor on the overall mine stability limit was investigated. The numerical results clearly showed that linear models could not realistically represent the true behaviour of the mine structure. The results obtained are in good agreement with that predicted in the field.