The research on increased ductility of organic-rich shale and its impacts on hydraulic fracturing has received relatively little attention. According to recent experimental studies, the popular cohesive zone model that only features decreasing traction along with crack separation may not adequately represent the crack behavior in shale due to ample organic matter. This paper starts by proposing a modified cohesive zone model that can represent various traction-separation laws (TSL) within a unified formulation. Then a fully coupled poroelastic XFEM framework to simulate hydraulic fracturing in organic-rich shales was developed in Matlab and comprehensively verified against the latest analytical solutions. The influences of increased ductility in different forms were studied using the modified cohesive zone model in the context of field-scale hydraulic fracturing simulations. Three important conclusions were drawn. First, the shape of TSL does affect the hydraulic fracturing given the same cohesive crack energy and tensile strength. It suggests that ductility is not only controlled by cohesive crack energy and tensile strength, which further indicates the necessity of the newly proposed TSL. Second, the tensile strength, controlling when the cohesive crack starts propagating, has the greatest impact on the hydraulic fracturing, among all TSL shape parameters. The impacts of TSL parameters become less significant as the fracturing fluid viscosity increases. Lastly, Young’s modulus is the only one among four common poroelastic parameters that significantly changes the ductility/brittleness of rock formation and hydraulic fracture lengths. The increase in cohesive energy accompanied by the decrease of Young’s modulus will greatly reduce the induced fracture length.