The mechanisms of in-plane shear deformation in a cross-ply glass fiber-epoxy laminate were studied through a combination of experiments and simulations. Shear deformation parallel and perpendicular to the fibers led to very different deformation and fracture patterns. Deformation was localized in a matrix shear band parallel to the fibers in the former, while fiber rotation and widespread plastic deformation in the matrix were dominant in the latter. The differences in the mechanical response between both orientations increased with the applied strain and it was shown that the cross-ply laminate response was given by the averaged contribution of both. The relevance of this behavior for the development of continuum damage mechanics models is noted.