An analysis of envelope signals of acoustic emission (AE) produced from carbon/polycarbonate and Kevlar®/polycarbonate composites undergoing tensile deformation has been carried out to identify the sources of emission. The Kaiser effect was reproduced to validate the AE technique. Two different fiber failure mechanisms, i.e., fiber fracture and fiber degradation in Kevlar®/polycarbonate composite have been identified. A one‐to‐one correspondence between acoustic emission signals and fiber fracture and degradation has been established. It is shown that the critical length of the fiber, evaluated by using acoustic emission signals, is helpful in understanding the fracture behavior of the composites, as affected by surface treatments of the fibers. Copyright © 1990 Society of Plastics Engineers