Abstract: The microcapsules were synthesized by in-situ polymerization technology respectively with urea-formaldehyde resin (UF) or melamine-urea-formaldehyde co-condensed resin (MUF) as shell materials and epoxy resin (E-51) as core materials. A series of epoxy composite specimen were prepared using the microcapsules in order to study the effects of the microcapsules. Tensile and bending properties of the composite specimen were tested by universal tensile machine, and the fracture surface of composite materials was observed. The results show that the tensile strength and flexural strength of epoxy resin decrease with the increases of microcapsule amount. The elongation at break and fracture bending strain increase when the mass fraction of microcapsules is less than 2%, while decreases when the mass fraction of microcapsules is more than 2%. The microcapsules have a significant toughening effect on the epoxy resin. The rougher microcapsule surface and the smaller particle size are, the more ductile the composite is. The microcapsules likely rupture in the crack propagation and the microcapsules likely strip in the crack terminal zone.