Lateral-torsional buckling (LTB) strength of steel I-beams subjected to moment gradient loading is scaled by the moment gradient factor, Cb. The Cb factor depends on the non-uniformity of moment diagram, the height of the applied transverse loads within the unbraced length and end conditions. Generally, the Cb factors given by codes have been derived from elastic LTB analysis theory. However, the same Cb factors are used for beams that buckle inelastically. This paper develops a three dimensional finite element model using ANSYS for the inelastic nonlinear flexural-torsional analysis of I-beams and uses it to investigate the effects of unbraced length and central off-shear center loading (located at center, top flange and bottom flange) on the moment gradient factor in inelastic behavioral zone. It is found that the Cb factors given by AISC-LRFD in Specification for structural steel buildings (AISC 360-05) and Structural Stability Research Council Guidelines are not accurate for the point load cases applied at center and bottom flange in which I-beam buckles inelastically. It is seen also that the AISC-LRFD flexural resistance equations overestimate the actual moment capacity of inelastic I-beams under moment gradient. Therefore, a simple equation is proposed to be used instead of the code equation in inelastic zone for the investigated load cases in this paper.