A two-step finite element framework is presented that examines the effect of microscale thermal residual stress on the nanoindentation properties of fibre-reinforced composites. Firstly, micromechanical modelling is used to determine the residual stress state following thermal cooldown of a carbon-fibre composite material from cure temperature. A three-dimensional finite element nanoindentation model is then used to characterise the effects of residual stress on material properties determined by nanoindentation theory. The results show that the hardness of the matrix pockets decreases following thermal cooldown due to the existence of equibiaxial tensile residual stresses. The hardness property is also found to decrease for the majority of interfacial region stress states, while the microstructural areas where the effects of the residual stress are nullified are determined. The indentation modulus property is relatively insensitive to the microstructural residual stress, and thus is the recommended indentation property to be determined when carrying out a comparative parametric analysis between microstructural regions. The property changes are shown to be insensitive to any errors associated with contact area estimation using the Oliver and Pharr method.