The degradation of the epoxy resin matrix in the core rods of composite insulators is the primary factor leading to decay-like deterioration and fracture accidents. Partial discharge in a humid environment is a critical trigger for this phenomenon. As an organic polymer, epoxy resin is prone to degradation under discharge, producing complex degradation products that can have secondary effects on surrounding materials, further accelerating the decay-like deterioration process. To optimize the formulation and manufacturing process of composite insulator materials and mitigate or even prevent decay-like fractures, it is crucial to study the discharge degradation products and mechanisms of the epoxy resin matrix. In this study, discharge experiments were conducted on anhydride-cured bisphenol A epoxy resin used in composite insulators within a closed humid environment. Changes in chemical functional groups of solid samples before and after discharge were analyzed from the high-frequency region to the fingerprint region. The main components and relative yields of liquid and gaseous discharge products were detected, and the primary reaction mechanisms during the discharge degradation process were thoroughly investigated. Results indicate that partial discharge in humid air induces instantaneous temperature rise and radical action, leading to epoxy resin degradation, generating alcohols and hydroxyl groups, which may increase the material’s hydration capacity and surface conductivity, thereby reducing electric field uniformity. Gaseous products such as methane, acetone, ethylene, and ethyl acetate produced by discharge pyrolysis may exacerbate stress at the core rod and sheath interface, increasing the risk of interfacial damage. Liquid products like nitric acid, carboxylic acids, and acetone may accelerate glass fiber fracture and sheath swelling.