Unreinforced masonry (URM) buildings present a serious threat to communities in earthquake prone regions because they typically exhibit brittle and catastrophic failures. These failures have been observed in the aftermath of recent earthquakes such as the 2010 Haiti (Mw 7.0) and the 2010 Maule Chile (Mw 8.8). There is therefore a pressing need for developing cost-effective retrofit strategies for URM buildings. Most of the current retrofitting techniques affect the aesthetics of the existing walls, which has the undesired result of significantly changing the architectural appearance of signature and cultural heritage buildings. The main goal of this study is to propose a solution for seismic retrofit of URM walls using embedded reinforcement into the pre-cut grooves in the surface of walls. To investigate the feasibility of the proposed retrofitting technique, which has relatively less effect on aesthetics of the existing URM walls, a nonlinear finite element model is implemented which simulates the performance of the walls before and after retrofitting. In this study, the mortar joint is modeled with a zero-thickness cohesive interface element while the masonry unit is modeled with the combined smeared and discrete crack approaches. The reinforcing steel is modeled using truss elements. The results showed that both the strength and ductility of the retrofitted walls are enhanced with this innovative retrofitting technique.