This paper is concerned with theoretical treatment of thermoelastic involving a laminated composite hollow cylinder with an interlayer of functionally graded material. The thermal and thermoelastic constants of the interlayer are expressed as power function of the radial coordinate variable. We obtain the exact solution for the one-dimensional temperature change, and thermal stresses of a hollow cylinder under the state of plane strain. Some numerical results for the temperature change, the displacement and the stress distributions are shown.