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The piezoelectric properties of tetragonal BaTiO3 (BTO) crystals with a high density of 90° twin domain boundaries were experimentally investigated by Wada and Tsurumi (2004 Br. Ceram. Trans. 103 93). These crystals with engineered dense domain structures exhibit significantly larger intrinsic d33 and d31 coefficients than in mono-domain crystals. This phenomena was studied theoretically and several enhancement mechanisms (domain wall broadening, polarization tilting) were suggested in the past, but no satisfactory explanation was found. We present a model which incorporates the additional effect of stress-assisted phase transition in elastically incompatible domain structures of BTO. According to our results, the internal stress, existing in  poled tetragonal BTO, shifts the system closer to the 4mm-mm2 phase transition, and the latter leads to the enhancement of macroscopic piezoelectric properties. The domain structure and effective properties of the BTO crystal are analyzed with phase field simulation based on Ginzburg-Landau-Devonshire theory.