A method has been developed for the thermal analysis of materially nonlinear carbon fibre reinforced plastic (CFRP) step-tapered laminated plates using a quasi-three-dimensional iso-parametric finite element. The variation with temperature of the coefficient of expansion of CFRP in the transverse direction is included. The nonlinear initial thermal stresses resulting from cooling from the stress-free temperature of 132·2°C (270°F) to 20°C in [+θ/-θ/resin/90°/90°]s and [+θ/-θ/resin/+45°/-45°]s stepped plates were found. All stepped plates were then subjected to a uniform applied stress until first-ply failure was detected inside the laminate according to the maximum strain failure criterion. This nonlinear analysis was based on an initial stress iteration method formulated in a previous paper. In all cases, the resin-rich layer between the laminae that form the step was included. It was found that the initial thermal stresses of some stepped plates are of the same sign as their corresponding cases under an applied tensile stress but without initial thermal stresses included. With initial thermal stresses included, these stepped plates failed at an applied stress lower than for the cases without the initial thermal stresses. In contrast, the initial thermal stress components of other stepped plates are of opposite sign to their corresponding cases under an applied tensile stress only. With the inclusion of the initial thermal stresses, these stepped plates failed at a higher tensile stress than the cases without initial thermal effects. The [+θ/-θ/resin/+45°/-45°]s stepped plates exhibited lower strengths than the [+θ/-θ/resin/90°/90°]s stepped plates. The results suggest that the [+45°/-45°/resin/90°/90°]s laminate is probably better suited to resist tensile loading. © 1992.