Abstract: To address stress concentration in the boss–liner transition region and lightweight design requirements of Type IV carbon-fiber-wound pressure cylinders with plastic liners, local reinforcement was investigated by applying carbon cloth to the outer surface of the PA6 liner dome. A progressive damage model based on the Hashin failure criterion and the Camanho stiffness degradation model was established and validated through hydrostatic burst tests. The effects of the local reinforcement range, angle, and thickness on dome stresses were investigated using the control-variable method. The results show that enlarging the reinforcement region reduces stress concentration in the boss–liner transition region. The reinforcement angle mainly affects load sharing between the reinforcement layer and the original winding layers, although the differences among the investigated angles are relatively small. Insufficient reinforcement thickness has little effect on the original critical failure location, whereas excessive thickness causes load transfer toward the transition layer and the reinforcement boundary. Based on a comprehensive analysis, the recommended reinforcement range, angle, and thickness are 38–111 mm, 45°, and 2.1 mm, respectively. Helical-ply reduction was subsequently investigated for the locally reinforced cylinder by removing one pair of ±17° helical plies. The gravimetric hydrogen storage density of the cylinder increases from 6.04% to 6.43%, and the failure location shifts from the dome in the original design to the cylindrical section. This study provides a reference for local reinforcement design on the outer surface of the liner dome in Type IV pressure cylinders under internal pressure loading.