In this study we demonstrate that multiwalled carbon nanotube fillers can impart a strain sensing functionality to a composite. The nanocomposite is fabricated by dispersing 5% weight of multiwalled nanotube fillers into a polycarbonate matrix. When subjected to linear and sinusoidal dynamic strain inputs, the instantaneous change in the electrical resistance (deltaR/R0) of the nanocomposite responds in a manner similar to a strain gage. The sensitivity of the nanocomposite sensor was measured to be approximately 3.5 times that of a typical strain gage. This sensitivity of the nanocomposite's electrical properties to mechanical stress implies that in addition to enhancing mechanical properties (strength, stiffness, structural damping, etc.), these multifunctional materials show the potential to provide real-time structural health monitoring and self-diagnostic functionalities.