An exact elastic-plastic solution is obtained for the residual stress and strain field in a finite circular sheet having a cold-worked or interference fitted hole on the basis of J 2 deformation theory together with a modified Ramberg-Osgood law. Many factors influencing the residual stresses are then analysed. Further, comparison with finite element results and experimental data for rectangular sheets containing cold-worked holes is made. It is shown that the solution of a finite circular sheet can be used to predict the residual stresses on the minimum cross-section in a rectangular sheet with a cold-worked hole quickly and effectively, so long as the diameter of the circular sheet is equal to the width of the sheet.