We present an efficient and reliable approach for the numerical modelling of failure with nonlocal damage models. The two major numerical challenges––the strongly nonlinear, highly localized and parameter-dependent structural response of quasi-brittle materials, and the interaction between nonadjacent finite elements associated to nonlocality––are addressed in detail. Reliability of the numerical results is ensured by an h-adaptive strategy based on error estimation. We use a residual-type error estimator for nonlinear FE analysis based on local computations, which, at the same time, accounts for the nonlocality of the damage model. Efficiency is achieved by a proper combination of load-stepping control technique and iterative solver for the nonlinear equilibrium equations. A major issue is the computation of the consistent tangent matrix, which is nontrivial due to nonlocal interaction between Gauss points. With computational efficiency in mind, we also present a new nonlocal damage model based on the nonlocal average of displacements. For this new model, the consistent tangent matrix is considerably simpler to compute than for current models. The various ideas discussed in the paper are illustrated by means of three application examples: the uniaxial tension test, the three-point bending test and the single-edge notched beam test