This article explores the tensile deformation and failure characteristics of a hybrid composite where microscale shape memory alloy (SMA) fibers and nanoscale graphene nanoplatelets (GNPs) were used to reinforce a ductile epoxy matrix. First, the GNPs were incorporated into epoxy system using a hybrid dispersion technique at various weight percentages ranging from 0.25 to 2.50 wt%. The mechanical properties of GNP composites were investigated using monotonic uniaxial tensile tests to failure and were compared to neat epoxy. The GNP concentration that resulted in highest enhancement in tensile properties of the epoxy was identified. Then, the GNP/SMA/epoxy composites were fabricated using a vacuum assisted hand lay-up technique. The composites were reinforced with SMA fibers at 50% volume ratio and an optimal GNP concentration was added. The tensile response of the developed composites was characterized using full-field strain measurements captured by a digital image correlation system, while simultaneously the thermal response of the composites was monitored through measurements of an infrared camera. The tensile properties, superelastic response, and failure mechanisms of the developed composites were discussed. Results shows that the developed GNP/SMA/epoxy composites exhibit excellent superelastic characteristics with a maximum strength of 533 MPa and failure elongation of 12.5%.