The prediction of the forming limit diagram at fracture (FLDF) is of great importance, specially in cases where forming is controlled by fracture instead of necking. A physical model of coalescence is proposed in two cases of internal damage: (i) damage by decohesion of the particle matrix interface, and (ii) damage by failure of the particle. An analytical equation of the fracture curve is obtained in the case of damage by decohesion and this predicts a linear shape for the FLDF, which is in agreement with experiment. In contrast, in the case of damage by failure, a curved shape for the FLDF is obtained, which is also in agreement with experiment. Comparison of the models presented with other criteria is made.