The (DD) method was used to model the formation of the plastic zone of the top of the cracks in polycrystalline molybdenum. Special attention was paid to take into account the interaction of dislocations in the plastic zone with grain boundaries. Structural sensitivity of fracture toughness was analyzed under brittle-ductile condition. Simulations were performed for a range of grain sizes from 400 to 100 μm, at which a sudden increase in fracture toughness with a decrease of grain size was experimentally shown. We calculated the value of K1c taking into account the shielding action of dislocations. The position of all dislocations in the plastic zone at fracture moment was calculated. Based on these data, we obtained the dependences of dislocation density on the distance from the crack tip thereby confirming significant influence of the grain boundaries on plastic zone formation. At large grain sizes, when the plastic zone does not touch the boundary, the distribution of dislocations remained unchanged. As grains reduce their size to size of the plastic zone, they start formating a dislocation pile – up near the boundaries. Dislocations on plastic zone move slightly toward the crack tip, but the density of dislocations in the middle of the grain remains unchanged, and fracture toughness remains almost unchanged. Further reduction of the grain size leads to the Frank-Reed source activation on the grain boundary Forming dislocation pile-up of the neighbor grains. Its stress concentration acts on dislocations of the first grain and causes redistribution of plastic zone dislocations. If the reduction in grain size is not enough to form a strong pile-up, density of dislocations on plastic zone increases slightly and crack resistance increases a few percent. Further reduction of grains promotes strong pile-up, dislocations move to crack tip, and its density on plastic zone increases. Crack is shielded and fracture toughness increases sharply. The calculation showed that the fracture toughness jump is observed at grain sizes of 100—150 μm, in good agreement with the experiment. Keywords: dislocation dynamics simulation, molybdenum, fracture toughness, grain size, plastic zone, brittle-ductile transition.