As one type of the important alternative fuel containers, composite cylinders are widely used in compressed natural gas vehicles (CNGV) all over the world. Compared to traditional metal containers, the performance of composite cylinders is more complicate because it is difficult to analyze the material characteristics and the influence of manufacturing process. With the aid of numerical simulation, the damage tolerance of one type of composite cylinder was investigated in this paper. Firstly, the usual damage modes and sizes that are generated in the serviced composite cylinders are classified to illustrate the dangerous parts in the composite cylinders. According to the manufacturing process of composite cylinders, the fiber material characteristics that account of the effects of heat and resin are evaluated to conduct the numerical simulation. Under the damage modes and sizes such as initial flaw, fiber fracture and delamination that are distributed in the cylinder in terms of the classification, the performance of composite cylinder are carried out. With the convenience of numerical simulation, the map of the dangerous sites under the elaborate damage modes and sizes is given to evaluate the running condition of composite cylinders in practice. The quantitative results are more useful to show the damage tolerance of composite cylinder than the traditionally qualitative check way and guarantee the running of CNGV.