The work aims to study the effect of laser shock peening-cold extrusion composite strengthening process (LSP-CP) on fatigue initiation and fatigue life of 7050 aluminum alloy fastener holes. The finite element simulation of CP was conducted with the software of ABAQUS and the cyclic load was applied to obtain the data of residual stress after strengthening. Then the fatigue test was performed with stress level of 195 MPa and stress ratio of 0.1. The results of simulation and fatigue test were compared with the process of laser shock peening (LSP) and cold extrusion (CP). The surface and hole wall could be reinforced by LSP-CP and the value of residual compressive stress induced by LSP-CP was higher than that of LSP at these locations. The residual stress difference between LSP-CP and LSP reduced under cyclic load. But for CP, the surfaces were tensile stress, and residual stress around the extruded surface hole corner was changed from -928 MPa to 300 MPa under cyclic load. In addition, fatigue crack of untreated fastener hole initiated at the hole corner. The fatigue crack of fastener hole reinforced by laser shock initiated at the middle hole wall. The extended area of fatigue crack of fastener hole subject to composition reinforcement was the largest. The fatigue lives of untreated hole, LSP-worked hole, CP-worked hole and LSP-CP-worked hole were 65,918, 165,117, 114,494 and 225,209 respectively. Compared with untreated fastener hole, the fatigue lives of LSP-worked hole, CP-worked hole and LSP-CP-worked hole were increased. LSP-CP-worked hole has the longest fatigue life and can further improve the fatigue life of fastener holes. The residual compressive stress layer induced by LSP and LSP-CP can resist the fatigue crack initiated at the surface, while the CP cannot.