A nonlinear finite element buckling analysis based on updated Lagrangian formulation is presented to study the compression behaviour of damaged laminated composite plates. A continuum damage mechanics based approach is used to study the coupled behaviour of instability and the associated damage developed in the laminated plates due to the applied compressive loading. The laminated plate is modeled as the sets of laminae bonded together by an elastic interface which is represented by a continuous distribution of matrix material. In this study, a composite laminated plate with and without an existing damage is also considered. A layerwise plate model is used to study the effect of the presence of existing static damage on the buckling strength of laminated plates. Further, the initiation and growth of the existing damage is also studied which may lead to catastrophic failure before the instability occurs.