Failure of stiffened panels under compression is preceded by buckling of their skin and hence is affected by the presence of out-of-plane stresses. One of the promising methods of preventing premature delamination is stitching. The present paper discusses the effect of such stitching on compression behavior of blade-stiffened panels that were fabricated from plain weave AS4/3501-6 through resin film infusion process. Kevlar 29 yarn was used at a stitch density of 9.92 stitches per cm2. Some of the panels were damaged by drop-weight impact before compression testing. For comparison purposes unstitched panels with the same materials and dimensions were also tested under the same loading conditions. Stitching resulted in a 10% improvement in strength in the absence of any intentional damage. The beneficial effect of stitching was most obvious when the panels were impacted on a flange: a 50% improvement was observed in post-impact strength. However, stitching could not prevent stiffener from failure when impacted directly. Thus stitching had no beneficial effect when impact occurred on a stiffener. A buckling and post-buckling analysis was carried out using 3-D shell elements on the Abaqus. Predictions were in fairly good agreement with the experimental data.