Piezoelectric wafer active sensors (PWAS) are lightweight and inexpensive transducers that enable a large class of structural health monitoring (SHM) applications such as: (a) embedded guided wave ultrasonics, i.e., pitch-catch, pulse-echo, phased arrays; (b) high-frequency modal sensing, i.e., the electro-mechanical (E/M) impedance method; and (c) passive detection (acoustic emission and impact detection). The focus of this paper is on the challenges posed by using PWAS transducers in the composite structures as different from the metallic structures on which this methodology was initially developed. After a brief introduction, the paper reviews the PWAS-based SHM principles. It follows with a discussion of guided wave propagation in composites and PWAS tuning effects. Then, it discusses damage modes in composites. Finally, the paper presents some experimental results with damage detection in composite specimens. Hole damage and impact damage were detected using pitch-catch method with tuned guided waves being sent between a transmitter PWAS and a received PWAS. Root mean square deviation (RMSD) damage index (DI) were shown to correlate well with hole size and impact intensity. The paper ends with summary and conclusion; suggestions for further work are also presented.