The change in a magnetization transition zone in a magnetic recording medium is analyzed under stress application by the self-consistent iterative calculation method. The medium is assumed to be composed of uniaxial single domain magnetic particles with two-dimensional angular distribution of easy axes. Owing to the applied stress, the demagnetizing field temporarily increases at the localized area, because the magnetization distribution changes due to stress-induced easy axes rotation. The applied stress also changes the critical field for irreversible magnetization switching; hence, additional magnetization reversal takes place for particles which suffer critically large demagnetizing field. Consequently, the present simulation can explain the stress-induced demagnetization phenomenon, in which reproduced signal level attenuates as a result of magnetization transition broadening caused by stress.