A vehicle differential assembly is provided that includes a differential adapted to allow differing rotational speed between a pair of outputs. The differential includes a gear assembly connected to the outputs and one or more hydraulically-actuated clutches for selectively and variably coupling the outputs. A hydraulic pump is adapted to generate hydraulic fluid pressure for engagement of the hydraulically-actuated clutches. A variable-engagement clutch is operatively connected to the input and the hydraulic pump such that the input selectively drives the hydraulic pump during engagement of the clutch to provide hydraulic fluid pressure to the hydraulically-actuated clutches. A valve operatively connected to the hydraulic pump and the hydraulically-actuated clutches to selectively and variably provides fluid pressure from the hydraulic pump to the hydraulically-actuated clutches. A method of controlling vehicle stability is also provided.