- A hybrid Shape Memory Alloy (SMA) - MAX phase ceramic composite for use in extreme environments is currently being developed. It is intended that the combination of these two inelastic materials provides the possibility of developing residual stress fields in the composite. These stress fields could be used to apply a prestress on the ceramic phase which takes advantage of the superior mechanical response exhibited under compressive loadings. To explore the development of these residual stress fields and the effective actuation response of the considered composite, a computational micromechanical model is developed. To account for the heterogeneous microstructure in such material systems, image-based techniques are used to develop finite-element meshes based on characterization of an actual composite microstructure. A recent SMA constitutive model is used to describe the response of that phase while an elastic-plastic approximation of the MAX phase is introduced. The resultant model is then used to explore the effective actuation response and interaction of the inelastic phases. An interesting shift in the transformation temperatures necessary to induce transformation is observed and the effect explained. It is also demonstrated that when subjected to sufficient loads, irrecoverable strains are generated in the composite. The effect of these strains and the residual stress fields they cause are then explored and discussed. It is demonstrated that the desired compressive residual stress may be generated through an appropriate thermomechanical processing path. 2012 AIAA.