Recent finding of an unusual in-plane resistivity anisotropy in the underdoped 122 family at high temperature (T) suggests an orbital nematic (ON) order, posing a challenge to extant theories. The sign of the anisotropy contradicts expectations from weakly correlated as well as pure spin-only nematic views. Here, we show how such an ON order with accompanying structural distortion arises from residual, intersite, and interorbital two-body interactions in an incoherent bad metal close to Mottness. Enhancement of orbital-selective incoherence is shown to be necessary for understanding transport anisotropy. Our results suggest that ON order, with subsequent antiferromagnetic order, might be the primary competitor to superconductivity in Fe arsenides.
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