During their operational life-time, actively cooled liners of cryogenic combustion chambers are known to exhibit a characteristic so-called doghouse deformation, pursued by formation of axial cracks. The present work aims at developing a model that quantitatively accounts for this failure mechanism. High-temperature material behaviour is characterised in a test programme and it is shown that stress relaxation, strain rate dependence, isotropic and kinematic hardening as well as material ageing have to be taken into account in the model formulation. From fracture surface analyses of a thrust chamber it is concluded that the failure mode of the hot wall ligament at the tip of the doghouse is related to ductile rupture. A material model is proposed that captures all stated effects. Basing on the concept of continuum damage mechanics, the model is further extended to incorporate softening effects due to material degradation. The model is assessed on experimental data and quantitative agreement is established for all tests available. A 3D finite element thermo-mechanical analysis is performed on a representative thrust chamber applying the developed material-damage model. The simulation successfully captures the observed accrued thinning of the hot wall and quantitatively reproduces the doghouse deformation.