The main emphasis of this work is to fabricate a new composite system having high impact performance, light weight, cost-effective and reduced water absorption. Glass (G)–polypropylene (P) fibers reinforced epoxy composite laminates were fabricated using the hand lay-up technique. The impact response and water absorption capabilities of G–P fibers reinforced epoxy composites were investigated to know their suitability and adaptability for different industrial applications. Morphological studies of the fractured surfaces were performed using scanning electron microscopy (SEM). Two-parameter Weibull distribution function was used to obtain the scatter in the results and to construct the reliability graphs. These reliability graphs are important tools for helping the designers to understand and choose the suitable material for the required application. The proposed G–P/epoxy hybrid composites showed an improvement in the impact performance and reduction in water absorption capability compared to the host composites. The hybrid composite with G-fiber at the periphery and P-fiber at the core has lower void content and lower water uptake. The plies stacking sequence has almost no effect on edge-wise impact strength values, whilst it has a noticeable effect on flat-wise impact strength values. When P-layers are at the impacted face, the composite exhibits higher impact strength. Both edge-wise and flat-wise impact strengths increase when P/G fiber ratio increases.