This paper describes the development and the application of a novel carbon nanotube/poly(methyl methacrylate) (CNT/PMMA) composite electrode as a sensitive amperometric detector of CE. The composite electrode was fabricated on the basis of the in situ polymerization of a mixture of CNT and prepolymerized methylmethacrylate in the microchannel of a piece of fused-silica capillary under heat. The performance of this unique system has been demonstrated by separating and detecting honokiol and magnolol in traditional Chinese medicine, Cortex Magnoliae Officinalis. Factors influencing their separation and detection processes were examined and optimized. Honokiol and magnolol were well separated within 7 min in a 40 cm long capillary at a separation voltage of 15 kV using a 50 mM borate buffer (pH 9.2). The new CNT-based CE detector offered significantly lower operating potentials, yielded substantially enhanced S/N characteristics, and exhibited resistance to surface fouling and hence enhanced stability. It demonstrated long-term stability and reproducibility with RSDs of less than 5% for the peak current (n = 9) and should also find a wide range of applications in microchip CE, flowing injection analysis, and other microfluidic analysis systems.