Indium tin oxide (ITO) is the most widely used transparent electrode in flexible solar cells because of its high transparency and conductivity. But still, cracking of ITO on PET substrates due to tensile loading is not fully understood and it affects the functionality of the solar cell tremendously as ITO loses its conductivity. Here, we investigate the cracking evolution in ITO/PET exposed to two categories of tests. Monotonous tensile testing is done in order to trace the crack propagation in ITO coating as well as determining a loading range to focus on during our study. Five cycles test is also conducted to check the crack closure effect on the resistance variation of ITO. Analytical model for the damage in ITO layer is implemented using the homogenization concept as in laminated composites for transverse cracking. The homogenization technique is done twice on COMSOL to determine the mechanical and electrical degradation of ITO due to applied loading. Finally, this damage evolution is used for a simulation to predict the degradation of ITO as function in the applied load and correlate this degradation with the resistance variation. Experimental results showed that during unloading, crack closure results in recovery of conductivity and decrease in the overall resistance of the cracked ITO. Also, statistics about the crack spacing showed that the cracking pattern is not perfectly periodical however it has a positively skewed distribution. The higher the applied load, the less the discrepancy in the crack spacing data. It was found that the cracking mechanism of ITO starts with transverse cracking with local delamination at the crack tip unlike the mechanism proposed in the literature of having only cracking pattern without any local delamination. This is the actual mechanism that leads to the high increase in ITO resistance. The analytical code simulates the damage evolution in the ITO layer as function in the applied strain. This will be extended further to correlate the damage to the resistance variation in following studies.