Damage propagation and failure mechanisms in woven carbon fiber composites are complex due to their anisotropic nature and are affected by the percentage of constituents of the composite materials named fiber, matrix, and void. The “size effect” that relies on these parameters can be influenced by the volume fraction percentages of these constituents and composite manufacturing parameters. This research introduces a multi-instrumental structural health monitoring approach to understand damage progression due to the size effect under the Iosipescu configuration. Acoustic emission (AE) signals are classified via a K-means clustering algorithm to distinguish the damage activities based on their frequencies. It is shown that both size effect and void content are relatable based on cumulative AE energy jumps attributed to the accumulation of micro-damages inside these laminates. The thermal variations observed by passive infrared thermography are associated with the nonlinear response of the shear behavior. The outcomes of the thermal analysis are depicted to show the relationship between damage progress and laminate thickness. The digital image correlation analysis is performed to measure the full-field strain measurement during the testing. The correspondence of material thickness with elastic shear behavior is investigated via a comparison of shear strain maps.