The effects of oxidation treatments and surface coating on the surface properties of the solvated mesophase pitch-based carbon fiber (CF) are investigated to improve the mechanical properties of the potentially low-cost CF composites. The CFs were treated with air, O-3, CO2/H2O, or HNO3 solution or modified with an epoxy coating. The surface of the treated fibers was characterized by adsorption of methylene blue, NaOH uptake, fragmentation test, composite flexural test, and optical microscopy and SEM examination. Gaseous oxidization is considered a suitable and economical process for this potentially low-cost and low packing density CFs. O-3 oxidation is more effective than other oxidation treatments and introduces more acidic functional groups and a suitable surface area on the surface of the treated CFs, leading to a shorter fiber critical length and higher interfacial shear strength between the CF and the epoxy resin. Surface coating in 5 wt% of epoxy/acetone solution also effectively reduces fiber critical length due to improved fiber surface wettability. After surface treatment, the CFs can be directly fabricated into composite materials without weaving and knitting. Increased flexural strength and modulus of the composites are achieved by the use of O-3-oxidized fibers and fiber surface coatings. Optical microscopy and SEM confirm that the composites fabricated with the surface-treated fibers have less debonded area or voids than the untreated ones.