A new finite‐difference (FD) method is presented for modeling SH-wave propagation in a generally heterogeneous medium. This method uses both velocity and stress in a discrete grid. Density and shear modulus are similarly discretized, avoiding any spatial smoothing. Therefore, boundaries will be correctly modeled under an implicit formulation. Standard problems (quarter‐plane propagation, sedimentary basin propagation) are studied to compare this method with other methods. Finally a more complex example (a salt dome inside a two‐layered medium) shows the effect of lateral propagation on seismograms recorded at the surface. A corner wave, always in‐phase with the incident wave, and a head wave will appear, which will pose severe problems of interpretation with the usual vertical migration methods.