Structural health monitoring (SHM) is emerging as an important technology to improve the safety and maintainability of critical engineering structures. SHM combines multidisciplinary technologies including sensing, signal processing, pattern recognition, mathematical modeling, data mining, and materials’ science. Due to the wide application of carbon fiber reinforced composites and their multiscale failure mechanisms, it is necessary to emphasize the research of SHM on composite structures. A comprehensive SHM framework for damage detection and quantification is first presented. To better understand a composite structure, guided wave propagation is applied to composite laminate structures such as sandwiched composite wing structures using piezoelectric transducers. Matching pursuit decomposition based signal processing algorithm and pattern recognition techniques are integrated for feature extraction and damage diagnosis. The developed approach provides a mathematically rigorous method for the detection of coupled damage including delamination and matrix cracking. Current technical challenges of SHM will be presented at the end of the talk.