In aerospace applications, carbon fibre reinforced plastic (CFRP) composite parts are prone to fibre-breakage, matrix cracking and delamination as a result of manufacturing and assembly errors, or in-service impacts. The idea of developing “smart” composites with built-in sensing networks for real-time ultrasonic inspection of aircraft parts has become very popular, to minimise equipment purchase costs and service delays associated with conventional non-destructive testing techniques. Recently, the authors proposed a novel design of “smart” CFRP plates including internal piezoelectric (PZT) transducers without any compromise on the compressive, flexural or interlaminar shear strength of the material. The sensors were embedded between the composite layers and covered with glass fibre patches for electrical insulation from the carbon fibres. A series of nonlinear ultrasonic experiments proved the suitability of this internal sensor configuration for detecting material damage, based on the second harmonic generation method. In this paper impacted CFRP samples with the same glass fibre insulated PZTs (G-specimens) were subject to fatigue testing and the number of cycles to failure (∼675,000) was found to be equal to that of impacted samples without sensors (P-specimens). Ultrasonic experiments on G-specimens showed that the acoustic nonlinearity was increased by almost two orders of magnitude up to 480,000 cycles based on the ratio of second-to-fundamental harmonic amplitude. This confirmed that the unique layout of embedded transducers could not only be used for material damage detection, but it was also capable of monitoring the damage evolution under repeated loading. The capacitance of the PZTs remained constant (∼1.54 nF) during ultrasonic experimentation, verifying their functionality for at least 70% of the fatigue life.