This paper presents analytical and experimental procedures for estimating elastic properties of a plain weft-knitted fabric and of polymer composite materials reinforced by it. Cotton yarn and fabrics are being considered as an environmentally friendly alternative to synthetic reinforcement in polymer composites. In the present investigation, cotton yarn of different length and cotton knitted fabric specimens of different knitting directions were tested by tension in order to obtain the stress–strain response. Elastic moduli of the cotton yarn and knitted fabrics, having different load span and knitting directions, were obtained. Cotton knitted fabric composites with thermoset polymer matrices were manufactured and tested for stiffness and strength. Based on the Leaf and Glaskin model, a numerical (FEM) elastic properties averaging model was elaborated. Calculated elastic properties of composite materials have shown high compatibility with experimentally obtained values.