Thin-ply composites represent a promising approach to further improve the performance of carbon fibre composite structures thanks to their ability to delay the onset of matrix cracking and delamination up to the point of fibre dominated failure. However, this increased strength comes with a more brittle failure response which raises concerns on damage tolerance. Thus a careful material optimization is needed to address this trade-off. In this work, eight different formulations of thin-ply composites ranging from low modulus to high modulus carbon fibres are evaluated to understand the effects of the fibre and matrix constituents on the onset of damage and strength in unnotched tensile (UNT) tests of quasi isotropic laminates for ply thicknesses between 300 and 30 microns. The obtained experimental data are combined in master curve diagrams for simplified material selection process. It is observed that certain thin-ply composites with a ply thickness t < 134 mu m can reach UNT strength corresponding to or approaching the ultimate strain of the fibres as well as UNT stress at onset of damage as high as 92% of the latter. Based on this knowledge, a novel aerospace grade toughened thin-ply composite system is developed which can reach a quasi-isotropic UNT strength above 1 GPa (> 95% of the fibre strain). The newly developed composite is further optimized to improve damage tolerance by toughening the resin and selected interfaces. The effect of those modifications on damage tolerance are evaluated through compression strength after impact (CAI) tests and open hole tensile tests (OHT). It is found that an optimized interlayer toughened thin-ply composite based on 68 microns plies of intermediate modulus fibre can reach both outstanding strength properties with comparable or better CAI and OHT strength compared to current aerospace grade composites.