SiC particle reinforced aluminum alloy has a wide application in the aerospace industries. In this study, laser shock peening (LSP), an advanced surface modification technique, was employed for SiCp/2009Al composite to reveal its microstructure, microhardness and residual stress evolution. After peening, high densities of dislocations were induced in the aluminum substrate, and stacking faults were introduced into the SiC particle. The microhardness was increased from 155–170 HV to 170–185 HV, with an affected depth of more than 1.5 mm. Compressive residual stresses of more than 200 MPa were introduced. The three-point bending fatigue of the base material, laser peened and milled after laser peened specimens with artificial crack notch fabricated by a femtosecond laser was investigated. The average fatigue lives of laser peened and milled after laser peened specimens were increased by up to 10.60 and 2.66 times, compared with the base material. This combined fundamental and application-based research seeks to comprehensively explore the applicability of LSP on metal matrix composite.