The residual stresses in the matrix of an AA339 aluminum/ 23%(vol.) Kaowool short fibre composite were measured by x-ray dim-action at 100 degreesC, after rapid heating and cooling at 200 degreesC/min between 100 degreesC and 300 degreesC. A special heating stage was developed, with a very low thermal expansion to minimize systematic errors due to specimen alignment and a very low thermal mass to permit rapid temperature changes. A linear position sensitive detector enabled diffraction peak profiles to be measured in 5 seconds. Rapid cooling from 300 degreesC produced high residual stresses at 100 degreesC which subsequently relaxed. After a slow thermal cycle (5 degreesC/min heating and cooling) the stresses at 100 degreesC were smaller and stable. Many subsequent rapid thermal cycles were required to establish the higher stresses and this behaviour is attributed to the development of a fine precipitate dispersion with a transition from coherent precipitates to incoherent ones. These results cannot be explained purely by dislocation mechanisms.