An investigation was performed to study the matrix cracking and delamination in laminated composite plates due to transverse impact. A model was developed for predicting the initiation of the matrix cracking and the shape and size of impact-induced delamination in laminated composite plates resulting from the ballistic impact. The model consists of a stress analysis and a failure analysis. A transient finite element analysis which was based on the higher-order shear deformation theory was adopted for calculating the stresses inside the laminated composite plates during impact. A failure analysis was used to predict the initial intraply matrix cracking and the shape and size of the interface delamination in the laminates. As a results, a shear matrix cracking which was governed by the transverse interlaminar shear stress occured at the middle layer near the midplane of laminates and a bending matrix cracking which was governed by the transverse inplane stress occured at the bottom layer near the surface of laminates. In a thick laminates, a shear matrix cracking generated first at the middle layer of laminates, but in a thin laminates, a bending matrix cracking generated first at the bottom layer of laminates.