In this article, we investigate the stress transfer characteristics of a novel hybrid hierarchical nanocomposite in which the regularly staggered short fuzzy fibers are interlaced in the polymer matrix. The advanced fiber augmented with carbon nanotubes (CNTs) on its circumferential surface is known as “fuzzy fiber.” A three-phase shear lag model is developed to analyze the stress transfer characteristics of the short fuzzy fiber reinforced composite (SFFRC) incorporating the staggering effect of the adjacent representative volume elements (RVEs). The effect of the variation of the axial and lateral spacing between the adjacent staggered RVEs in the polymer matrix on the load transfer characteristics of the SFFRC is investigated. The present shear lag model also accounts for the application of the radial loads on the RVE and the radial as well as the axial deformations of the different orthotropic constituent phases of the SFFRC. Our study reveals that the existence of the non-negligible shear tractions along the length of the RVE of the SFFRC plays a significant role in the stress transfer characteristics and cannot be neglected. Reductions in the maximum values of the axial stress in the carbon fiber and the interfacial shear stress along its length become more pronounced in the presence of the externally applied radial loads on the RVE. The results from the newly developed analytical shear lag model are validated with the finite element (FE) shear lag simulations and found to be in good agreement.