The dynamic characteristics of delaminated smart composite laminates are studied using animproved layerwise laminate theory. The theory is capable of capturing interlaminar shear stresses that are critical to delamination. The presence of discrete delamination is modeled through the use of Heaviside unit step functions. Stress free boundary conditions are enforced at all free surfaces. Continuity in displacement field and transverse shear stresses are enforced at each ply level. In modeling piezoelectric composite plates, a coupled piezoelectric-mechanical formulation is used in the development of the constitutive equations. Numerical analysis is conducted to investigate the effect of nonlinearity in the transient vibration of bimodular behavior caused by the contact impact of delaminated interfaces. Composite plates with delamination, subject to external loads and voltage history from surface bonded sensors, are investigated and the results are compared with corresponding experimental results and plates without delamination.