We argue that supersymmetry breaking by gaugino condensation in the strongly coupled heterotic string can be described by an analogue of Scherk-Schwarz compactification on the eleventh dimension in M-theory. The M-theory scale is identified with the gauge coupling unification mass, whereas the radius of the eleventh dimension rho is at an intermediate scale rho(-1) similar to 10(12) GeV. At the lowest order, supersymmetry is broken only in the gravitational and moduli sector at a scale m(3/2) similar to rho(-1), while it is mediated by gravitational interactions to the observable world. Computation of the mass splittings yields in general a hierarchy of soft masses at the TeV scale(similar to rho(-2)/Mp) with matter scalars much heavier than gauginos. (C) 1997 Elsevier Science B.V.