In this study, smart multifunctional composites (SMC) were developed to enable state estimation of structures in terms of the deformations at distributed locations due to applied loads and temperature gradients. The SMC was composed of a carbon fiber-reinforced polymer (CFRP) composite plate and an embedded microfabricated sensor network of densely distributed strain gauges. The microfabricated sensor network, with serpentine signal wires connecting the sensing elements, was manufactured on a 100 mm diameter silicon wafer using integrated circuit batch processing techniques. The robustness of the SMC was investigated and verified through shape estimation under mechanical loads and temperature gradients applied to the SMC. The mechanical load was applied to the SMC with fixed boundaries on four edges. The temperature gradient was applied to the SMC with simple supports on the four corners of the SMC plate by applying a uniform temperature on one side while controlling the temperature of the other side close to the room temperature. The results show that the SMC provides the shape of the deformed structure under loads with high resolution. Moreover, a numerical analysis of the SMC implemented in ABAQUS demonstrates a close correlation between the estimated deformed shape and the simulated structure allowing the potential establishment of a digital twin. The SMC can be customized based on different requirements and applications by selecting the type, number, and locations of the sensors. The shape and state of the structure obtained from the SMC during operation can be used for online control, autonomy, decision-making, and maintenance.