Damage evolution in fatigue tests (R = 0.5, -1, 2) conducted on carbon fiber reinforced plastic (CFRP) composites has been characterized using digital image correlation (DIC). Since damage initiation/delamination is a local phenomenon affecting transverse strain more than the longitudinal, local transverse strain is a better indicator of onset of delamination and its propagation. Variation of transverse strain near the initiated delamination with cycles indicates that the damage evolution occurs over 2–3 stages. Each stage has a stable damage growth with sudden increase between the stages. Waviness and the associated error due to the lag between image and load data acquisition was overcome by plotting the maximum transverse strain obtained from a curve fit to each set of continuous cycles. Error due to large relative deformations was avoided by choosing different reference images for different stages. Extent of damage zone and its evolution was characterized by the length over which the transverse strain exceeds a limiting value, which was taken to be that at the end of first stage in the plot. Rate at which the damage propagates shows similar variation as that of the local transverse strain, which shows that the latter can be used as an indicator of fatigue damage evolution. This also provides a method to quantify the damage in terms of local transverse strain, which can in turn be used to validate any developed damage models. © The Society for Experimental Mechanics, Inc. 2017.