Banana fiber, one of the world's most important natural fiber obtained from the bast of the plant Musa Saptentum Linn, is available in plenty in Kerala. Without reinforcement, polyester resins are hard and brittle and cannot be used for structural applications. In the present study, short banana fiber-reinforced polyester composite materials have been fabricated using resin transfer molding technique. Mechanical properties such as tensile, flexural, and impact strength were studied as a function of fiber length and fiber content. It is seen that the addition of fibers makes the composite more ductile. The composites having fiber length of 30 mm and a fiber content of 40 vol % showed the maximum tensile strength. Flexural strength and impact properties showed similar trend. Scanning electron microscopy was performed to get an insight into the morphology of the composites. Water absorption study proved that fiber content and temperature conditions influences the diffusion of water into the composite. The composite having a fiber content of 50 vol % showed maximum values for diffusion, sorption, and permeability coefficient. Finally, the mechanical properties and water absorption behavior of the composites fabricated by RTM were compared with theoretical predictions. (C) 2008 Wiley Periodicals, Inc.