A microstructure-based FEM model that couples crystal plasticity, crystallographic descriptions of the B2-B19′ martensitic phase transformation, and anisotropic elasticity is used to simulate thermal cycling and isothermal deformation in polycrystalline NiTi (49.9at% Ni). The model inputs include anisotropic elastic properties, polycrystalline texture, DSC data, and a subset of isothermal deformation and load-biased thermal cycling data. A key experimental trend is captured—namely, the transformation strain during thermal cycling is predicted to reach a peak with increasing bias stress, due to the onset of plasticity at larger bias stress. Plasticity induces internal stress that affects both thermal cycling and isothermal deformation responses. Affected thermal cycling features include hysteretic width, two-way shape memory effect, and evolution of texture with increasing bias stress. Affected isothermal deformation features include increased hardening during loading and retained martensite after unloading. These trends are not captured by microstructural models that lack plasticity, nor are they all captured in a robust manner by phenomenological approaches. Despite this advance in microstructural modeling, quantitative differences exist, such as underprediction of open loop strain during thermal cycling.