X‐ray diffraction and photoluminescence measurements were made on InxAl1−xAs layers grown by molecular‐beam epitaxy whose lattice constants are matched, in tension, or in compression, relative to their (100)‐oriented InP substrates. Using a linear interpolation between the InAs and AlAs elastic stiffness coefficients, hydrostatic pressure coefficients, and shear deformation potentials, the strain‐dependent fundamental band gaps were calculated and shown to be in good agreement with the experimentally measured data within the pseudomorphic limit. The calculated composition‐dependent critical thickness for the onset of plastic deformation of these layers is shown to be in better agreement with the energy balance model of People and Bean than the mechanical equilibrium model of Matthews and Blakeslee.