A computational model for simulation of surface pitting of mechanical elements subjected to rolling and sliding contact conditions is presented. The two-dimensional computational model is restricted to modelling of high-precision mechanical components with fine surface finishing and good lubrication, where the cracks leading to pitting are initiated in the area of largest contact stresses at certain depth under the contacting surface. Hertz contact conditions with addition of friction forces are assumed and the position and magnitude of the maximum equivalent stress is determined by the finite element method. When the maximum equivalent stress exceeds the local material strength, it is assumed that the initial crack develops along the slip line in a single-crystal grain. The Virtual Crack Extension method in the framework of finite element analysis is then used for two-dimensional simulation of the fatigue crack propagation under contact loading from the initial crack up to the formation of the surface pit. The pit shapes and relationships between the stress intensity factor and crack length are determined for various combinations of contacting surface curvatures and loadings. The model is applied to simulation of surface pitting of two meshing gear teeth. Numerically predicted pit shapes in the face of gear teeth show a good agreement with the experimental observations.