The integration of Phase Changing Materials (PCMs) within sintered fly ash aggregate (SFA) offers an innovative approach to combat thermally induced stresses in rigid pavements. PCMs, with their ability to regulate temperature, are becoming increasingly popular in pavement applications. However, their effect on fracture performance and cracking susceptibility remains largely overlooked. This study delves into the fracture behavior of PCM-modified concrete, contrasting it with traditional concrete mixtures. Key parameters, including compressive strength, flexural strength, fracture toughness, elastic modulus, fracture energy, and thermal conductivity, were measured across various PCM replacement levels—ranging from 10 to 40%. The findings are striking. As the PCM content rises, a noticeable drop in fracture performance emerges. Specifically, fracture toughness (KIC) plummeted by 5.6–21.5%, elastic modulus (E) decreased by 4.5–13.3%, and fracture energy (GIC) fell by 6.7–28.9%. These results reveal a trade-off where PCM reduces thermal conductivity by up to 45.4%, effectively lowering thermal stresses and mitigating warping cracks, but also decreases mechanical strength, increasing crack susceptibility. The study identifies key mechanical limits for PCM content, laying groundwork for future research on advanced encapsulation methods to optimize both thermal and structural performance in pavements.