Microstructure development during severe plastic deformation by simple shear is modeled using a disclination model for substructure formation incorporated into the viscoplastic self-consistent (VPSC) polycrystal model. The strain incompatibilities between a homogeneous effective medium and a grain calculated by the VPSC model are assumed to result in an accumulation of disclinations at junctions of the grain. These disclinations are then relaxed by the growth of low-angle dislocation boundaries from the junctions. These boundaries split the grain into smaller, misoriented volumes which with further deformation can lead to its subdivision into new grains. The evolution of misorientation angles between the newly formed grains and the parent with applied straining agrees reasonably well with experimental misorientation angle distributions for geometrically necessary boundaries. Accounting for subgrain boundaries and grain subdivision results in textures after large strains that are more diffuse and lower in intensity than those predicted using standard VPSC modeling.