ABSTRACT In situ structural health monitoring of CFRPs relies on embedded flexible sensors for real‐time damage detection, yet confronts two critical challenges: commercially packaged sensors could compromise the inherent strength of the hosting laminate, while unpackaged counterparts suffer sensing performance degradation induced by carbon fiber conductivity. This study proposes an interlaminar toughening‐based in situ packaging strategy, integrating polyvinylidene fluoride (PVDF) piezoelectric films into CFRPs via polycaprolactone (PCL) films—serving the dual function of electrical insulation and interlaminar toughening. Two PCL films—electrospun nanofiber mat (PCL‐J) and solvent‐cast film (PCL‐L)—were fabricated and compared against polyimide (PI) films. Double cantilever beam (DCB) tests demonstrated remarkable improvements in Mode I interlaminar fracture toughness, with PCL‐J/PVDF composites achieving a 102.02% increase over pristine CFRP. Three‐point bending tests further confirmed that PCL mitigated the detrimental effects of sensor integration on flexural properties, while PI encapsulation degraded properties. Short beam shear (SBS) tests indicated that PCL/PVDF sensors enhanced the shear strength with a reduction of 4%–8%. Tensile properties remained largely unaffected by the integrated sensors. Concurrently, three‐point bending tests coupled with acoustic emission monitoring validated the PVDF sensors' capability for in situ damage detection. All three sensor types generated voltage signals corresponding to internal damage events, capturing distinct damage progression stages. Notably, PCL‐J/PVDF composites exhibited higher damage initiation thresholds and more gradual damage progression. This work successfully demonstrates that the strategy of using thermoplastic films as insulating/toughening interlayers enables the non‐destructive integration of functional PVDF sensors into CFRP, offering a promising approach for damage detection in high‐performance carbon fiber composites.