Background: The capsular ligaments and the labral suction seal cooperatively manage distractive stability of the hip. Capsular reconstruction using an iliotibial band (ITB) allograft aims to address capsular insufficiency and iatrogenic instability. However, the extent to which this procedure may restore hip distractive stability after a capsular defect is unknown. Purpose: To evaluate the biomechanical effects of capsular reconstruction on distractive stability of the hip joint. Study Design: Controlled laboratory study. Methods: Eight fresh-frozen cadaveric hip specimens were dissected to the level of the capsule and axially distracted in 3 testing states: intact capsule, partial capsular defect, and capsular reconstruction with an ITB allograft. Each femur was compressed with 500 N of force and then distracted 6 mm relative to the neutral position at 0.5 mm/s. Distractive force was continuously recorded, and the first peak delineating 2 phases of hip distractive stability in the force-displacement curve was analyzed. Results: The median force at maximum distraction in the capsular reconstruction state (156 N) was significantly greater than that in the capsular defect state (89 N; P = .036) but not significantly different from that in the intact state (218 N; P = .054). Median values for distractive force at first peak (60 N, 72 N, and 61 N, respectively; P = .607), distraction at first peak (2.3 mm, 2.3 mm, and 2.5 mm, respectively; P = .846), and percentage decrease in distractive force (35%, 78%, and 63%, respectively; P = .072) after the first peak were not significantly different between the intact, defect, and reconstruction states. Conclusion: Capsular reconstruction with an ITB allograft significantly increased the force required to distract the hip compared with a capsular defect in a cadaveric model. To our knowledge, this is the first study to report an initial peak distractive force and to propose 2 distinct phases of hip distractive stability. Clinical Relevance: The consequences of a capsular defect on distractive stability of the hip may be underappreciated among the orthopaedic community; with that said, capsular reconstruction using an ITB allograft provided significantly increased distractive stability and should be considered an effective treatment option for patients with symptomatic capsular deficiency.