We have calculated the effect of misfit stress on the compositional stability of strained‐layer hetero‐epitaxial compound semiconductor structures. For uniformly stressed layers, a simple formula is derived for the change in chemical potential of the lattice atoms diffusing across the hetero‐interface. An increase in the total chemical potential indicates that interdiffusion of the specific elements is thermodynamically unfavorable and therefore the composition of the structure is stable with respect to the misfit stress‐induced interdiffusion of the specific elements. On the other hand, a decrease in the total chemical potential indicates that the interdiffusion will be driven by the misfit stress and the composition of the heterostructure is unstable. Various strain‐layer systems of III–V compound semiconductors such as In1−xGaxAsyP1−y/InP, In1−xGaxAsyP1−y/GaAs, (Al1−xGax)yIn1−yP/GaAs, (Al1−xGax)yIn1−yAs/GaAs, In1−xGaxP/GaAs, In1−xGaxSb/InP, etc., are examined and their stability is discussed. ©1996 American Institute of Physics.