Numerical modeling of textile structures at the yarn level is challenging, yet provides information not obtainable through experimental studies alone. This study is focused on the development and finite-element analysis (FEA) of a three-dimensional (3D) woven structure with an in-plane negative Poisson’s ratio (NPR) effect, with the aim of exploring its potential applications in polymer composite reinforcement. While experimental and geometrical studies of 3D auxetic woven structures provide primary information, they have limitations in explaining the auxetic behavior of the structure at the yarn level. Additionally, prediction of the auxetic behavior of the 3D woven structure by varying material properties is only possible through FEA. Therefore, to overcome these limitations, a 3D FEA model of the structure was developed using commercially available software (Abaqus CAE-2020) to simulate the auxetic behavior. The structure was then studied for different binding yarn properties once a good agreement had been found between simulated and experimental results. The FEA provides new insights and provokes fresh discussion on the auxetic behavior of the 3D woven structure. One significant finding from the FEA is the strong influence of the axial ([Formula: see text]) and radial ([Formula: see text]) moduli of the binding yarn on the Poisson’s ratio of the 3D woven structure; [Formula: see text] has an inverse relationship, while [Formula: see text] demonstrates a direct relationship with the auxetic behavior of the structure. The developed FEA model is expected to provide a better foundation for the future development of 3D auxetic structures, particularly concerning their application in polymer composite reinforcement.