The unsaturated shear strength (τᵤ) equation was developed by incorporating the matric suction (uw−uₐ) into Terzaghi's saturated shear strength (τₛ). Few studies have examined the swelling stress (Ps) as a stress-state variable in expansive soils due to the complexity of swelling behaviour and practical limitations. The influence of (Ps) on the shear strength of unsaturated expansive soils is often overlooked. This study proposes a new unsaturated shear strength equation (τₘᵤ) based on the equilibrium of three stress-state variables: effective normal stress (σₙ−uₐ), (uw−uₐ) and (Ps). The τᵤ parameters and swelling stress of soil specimens were measured at different moisture contents using triaxial compression, filter paper, and zero-swelling tests. It appears that τᵤ is 1.1 to 1.76 times higher than τₛ due to the contribution of matric suction. Nonetheless, τᵤ values exceed τₘᵤ because the swelling stress reduces the cohesion of soil particles. The validation of the new shear strength equation involves comparing τₘᵤ with previous relevant equations documented in the literature. The study demonstrates that incorporating the swelling stress as an additional independent stress-state variable in τₘᵤ provides a realistic determination of the unsaturated shear strength of compacted expansive soils.