Differential Reynolds Stress model (RSM) based on Launder, Reece and Rodi (LRR) is formulated with appropriate wall functions and applied to predict the backward-facing step problem of Driver and Seegmiller. Numerical predictions obtained with LRR, with and without `wall reflective' terms in the pressure-strain model, are compared with the results of standard k-ε model of Launder and Spalding for the step problem. The results demonstrate that both LRR models i.e. with and without wall reflective terms, are capable of capturing the secondary recirculating bubble near the step as observed in the experiment, whereas the standard k-ε model fails to predict the secondary bubble. In addition, the mean velocity profiles obtained with the LRR models agree better with the experimental data than the k-ε model, particularly inside the recirculating region. It is also emerged from the present study that with proper wall functions, LRR model is capable of predicting recirculating flows, at least as good as the original LRR model, without the `wall reflective' terms.