A continuous strain finite-element model based on complete cubic polynomial expressions for the displacement field within each element and minimization of potential energy of the system is used to analyze the free-edge stress problem in laminated composites under uniform extension. Validity of the proposed numerical scheme is examined by solving for the stresses in a four-ply laminate and comparing the results obtained with those from Pagano's approximate theory, which is based upon application of Reissner's variational theory satisfying equilibrium of stresses within each lamina and ensuring continuity of displacements as well as tractions. Results from the two approaches agree closely. The finite-element procedure is then applied to a multi-layer laminated specimen to obtain reliable deformation and stress distributions.