For cable accessories, environmental moisture inevitably gradually diffuses into the XLPE-SiR composite interface. The penetrated moisture always causes interface insulation degradation and failure. In this paper, to investigate the discharge characteristics at the interface insulation, a composite interface discharge experimental unit is performed, and the insulation deterioration when the interface remains dry or becomes damped are discussed and analyzed. Combined with optical tests, discharge signal tests, SEM and EDS tests, the interface discharge characteristics are studied. In addition, several analysis models are established, and the discharge processes of the interface insulation are discussed in detail. Moreover, several field cases are discussed and compared to better understand the interface discharge. It is found that the discharge trace is mainly concentrated in one channel when the insulation remains dry. Moisture-induced early deterioration of the interface insulation is characterized by the emergence of non-conductive regions and weak dendritic discharge. As the interfacial water content increases, weak dendritic discharge turns into a macroscopic one. The occurrence and development of discharge after interface wetting can be attributed to two main factors. On one hand, interface discharge is related to the interface electric field distribution and interface contact morphology. On the other hand, the discharge performance is strongly influenced by the electric field distortion caused by water droplets, size of the dry area between water droplets, and increase in electrical losses ascribed to the invading moisture. The ultimate damage to the interface insulation takes two forms: continuous thermal breakdown that erodes the insulation, and instantaneous arc breakdown at the interface.