A progressive failure model is developed for laminated composites containing stress concentrations subjected to in-plane loading. The fundamental approach is to model a damaged lamina using a damaged ply constitutive relation in a simplified manner. The environmental effects including the thermal residual stresses and hygroscopic stresses arc taken into consideration. Parametric studies show that load increment only has little effect on the ultimate strength. When the number of elements for the finite element mesh increases to a certain value, the predicted ultimate strength approaches a stable value. The predictions for the ultimate strength, stress-strain behavior and the damage progression agree reasonably well with the experimental result.