Abstract Experimental investigation is performed to study tensile properties, damage initiation and development in stitched carbon/epoxy composites subjected to tensile loading. T800SC-24kf dry preforms with tow orientation of [+45/90/−45/0 2 /+45/90 2 /−45/0]s are stitched using 200 denier Vectran® thread. Modified-lock stitch pattern is adopted, and stitch density is varied, viz. moderate density (stitched 6 × 6: stitch density = 2.8 cm −2 ) and high density (stitched 3 × 3: stitch density = 11.1 cm −2 ). The stitched preforms are then infiltrated by epoxy XNR/H6813 using resin transfer molding process. Tensile test is conducted to obtain in-plane mechanical properties (tensile strength, failure strain, tensile modulus and Poisson’s ratio). Effect of stitch density on the mechanical properties is assessed, and it is found that stitched 3 × 3 modestly improves the tensile strength by 10.4%, while stitched 6 × 6 reduces the strength by only 1.4%. In stitched 3 × 3 cases, the strength increase is mainly due to an effective impediment of edge-delamination. Tensile stiffness and Poisson’s ratio of carbon/epoxy are slightly reduced by stitching. Fiber misalignment in in-plane and out-of-plane directions is responsible for stiffness reduction, whilst reduction of Poisson’s ratio is probably caused by the orthogonal binding effect of modified-lock stitch architecture. Damage mechanisms in stitched and unstitched composites are studied using acoustic emission testing and interrupted test coupled with X-ray radiography and optical microscopy. The detailed damage observation reveals that stitch thread promotes early formation of transverse and oblique cracks. These cracks rapidly develop, and higher density of cracks ensues in stitched composites. Although this behavior triggers early formation of delamination, stitched 3 × 3 effectively impedes the growth the delamination. In contrast, stitched 6 × 6 is ineffective in suppressing the delamination yet the cracks are vast in this specimen. One of the plausible reasons of the rapid development of cracks in stitched composites is fiber compaction effect whereby fibers are compacted and the gap among fibers is reduced. The verification of compaction effect is done experimentally by performing burn-off test to measure the local fiber volume fraction. It is confirmed that fiber compaction indeed occurs as indicated by higher local fiber volume fraction between stitch lines.