A vehicle differential assembly (22) is provided that includes a differential (24) driven by an input (26) and adapted to allow differing rotational speed between a pair of outputs (28, 30). The differential (24) includes a gear assembly (32) connected to the outputs (28, 30) and one or more hydraulically-actuated clutches (44) for selectively and variably coupling the outputs (28, 30). A hydraulic pump (54) is adapted to generate hydraulic fluid pressure for engagement of the one or more hydraulically-actuated clutches (44). A variable-engagement clutch (56) is operatively connected to the input (26) and the hydraulic pump (54) such that the input (26) selectively drives the hydraulic pump (54) during engagement of the clutch to provide hydraulic fluid pressure to the one or more hydraulically-actuated clutches (44). A valve (75) operatively connected to the hydraulic pump (54) and the one or more hydraulically-actuated clutches (44) to selectively and variably provide fluid pressure from the hydraulic pump (54) to the one or more hydraulically-actuated clutches (44). A method of controlling vehicle stability is also provided.