Unidirectional polymer composites were prepared using high-strength carbon fibers as reinforcement and phenolic resin as matrix precursor with keeping fiber volume fraction at 30, 40, 50 and 60% respectively. These composites were carbonized at 1000℃ and graphitised at 2600℃ in the inert atmosphere. The carbonized and graphitised composites were characterized for mechanical properties as well as microstructure. Microscopic studies were carried out of the polished surface of carbonized and graphitised composites after etching by chromic acid, to understand the effect of fiber volume fraction on oxidation at fiber-matrix interface. It is found that the flexural strength in polymer composites increases with fiber volume fraction and so does for the carbonised composites. However, the trend was found to be reversed in graphitised composites. In all the carbonized composites anisotropic region has been observed at fiber-matrix interface which transforms into columnar type microstructure upon graphitisation. The extension of strong and weak columnar type microstructure is function of fiber volume fraction. SEM microscopy of the etched surface of the sample reveal that composites containing 40% fiber volume has minimum oxidation at the interface, revealing a strong interfacial bonding.