An investigation was performed to study the fiber buckling failure of fiber-reinforced composites. This work was especially focused on understanding the effect of fiber-matrix interaction due to nonuniform loading on fiber buckling strength of unidirectional composites. An analytical model based on the energy principle was developed for predicting the fiber buckling strength of unidirectional composites. The model, which included the fiber bending energy and the matrix shearing energy, also considered the matrix extension energy which was attributed to the interaction between the fibers and the matrix. Numerical solutions were generated from the model to study the effect of fiber-matrix interaction on the fiber buckling strength of composites subjected to different types of loadings. Based on the calculations, it was found that the inclusion of fiber-matrix interaction in the fiber buckling analysis is very important for composites with nonuniform stress distributions. This becomes especially important for notched laminates and thick section composites subjected to compressive loading.