Cavitation has already been identified as an important damage mechanism in the comminution of kidney stones in shockwave lithotripsy (SWL). However, the precise conditions that maximize the damage caused by the collapsing bubbles are still unknown. Numerical simulations are used to investigate shock propagation and the consequent growth and collapse of a bubble cloud in the focal region of a lithotripter. In the simulations, a continuum two‐phase flow model for the ensemble‐averaged macroscale is coupled to a Gilmore model for individual spherical bubble dynamics at the microscale. The simulations show agreement with experimental pressure measurements and high‐speed photography of the bubble cloud. At void fractions commensurate with experiments, it is found that the collective collapse of the bubble cloud provides a significant increase to the energy available for comminution (beyond what a single bubble would produce). Relatively small increases in the pressure at the center of the cloud in advance of collapse (two orders of magnitude smaller than the initial shock) can more than double the energy of the collapsing bubble.