The damage evolution in composite material is a complex phenomenon, comprising several interacting failure modes like matrix cracking, fiber breakage, debonding and delamination. Damage initiation, its propagation and ultimate strength prediction of composite structure is of paramount importance for developing reliable and a safer design and utilizing them as primary load bearing one. During service life, these structures get damaged and are often repaired for extending their service life. In the present work, a 3D finite element-based progressive damage model is developed for predicting the failure and post-failure behaviour of notched and repaired panel under tensile load. Failure initiation load, ultimate strength and failure mechanisms are investigated through the developed progressive damage model. The accuracy of developed finite element model is assessed by comparing its prediction with the experimental results obtained from digital image correlation technique and they are found to be in good agreement. In this study, the panels made of carbon/epoxy composite laminates of pure unidirectional and quasi-isotropic stacking sequence are considered. The damaged panel is repaired with both single- and double-sided circular patch of same parent material. Stress-based 3D-Hashin's failure criterion is used for predicting the damage mechanism. Maximum shear stress and strain criteria are considered to account for patch debonding. It is found that the damage in notched panel always initiates with matrix cracking around the hole. However, damage in repaired panel is influenced by localized patch debonding. © The Author(s) 2014.