The expansion characteristics of thermally expandable microcapsules (TEMs) under hydrostatic pressure or in resin were experimentally investigated. For the experiments, the expansion of the microcapsules was observed in high-pressure nitrogen at high temperature utilizing optical microscopy with a digital camera installed. The TEMs used for the experiments were expanded by heating under hydrostatic pressure up to 3 MPa, but the expansion degree decreased with increasing pressure. A cured bulk specimen of epoxy resin containing the microcapsules was made, and the expansion of the microcapsules was again observed with the microscope. It was found that the expansion of the microcapsules in the resin was saturated at a certain temperature. The stress distribution in the resin produced by the expansion of the microcapsules was calculated by the finite-element method. It was found that normal stress occurred, but it was mainly compressive. Tensile stress was also generated, although the maximum value was smaller than that of shear stress. It was observed that the expansion of the microcapsules was limited when there were many microcapsules in the vicinity of the interface. In other words, a complicated stress state occurred, inducing interfacial failure along the interface.