The present paper discusses the key issues of carbon nanotube (CNT) dispersion and effect of functionalisation on the mechanical properties of multiscale carbon epoxy composites. In this study, CNTs were added in epoxy matrix and further reinforced with carbon fibres. Predetermined amounts of optimally amine functionalised CNTs were dispersed in epoxy matrix, and unidirectional carbon fiber laminates were produced. The effect of the presence of CNTs (1.0 wt%) in the resin was reflected by pronounced increase in Young's modulus, inter-laminar shear strength, and flexural modulus by 51.46%, 39.62%, and 38.04%, respectively. However, 1.5 wt% CNT loading in epoxy resin decreased the overall properties of the three-phase composites. A combination of Halpin-Tsai equations and micromechanics modeling approach was also used to evaluate the mechanical properties of multiscale composites and the differences between the predicted and experimental values are reported. These multiscale composites are likely to be used for potential missile and aerospace structural applications. © 2014 Kamal Sharma and Mukul Shukla.