Functionally graded material (FGM) concept has been applied successfully in order to improve/design heat transfer, electric and electronic conductivity, static and dynamic strengths of adhesive joints by reliving stress distributions in both adhesive and adherend materials. This new approach relies on tailoring material composition of adhesive and adherends along one or more coordinate directions. Thermal residual stresses in adhesive joints are a vital issue in terms of the joint strength. FGM concept also allows to relieve/control thermal residual stresses encountered in adhesive joints due to mismatches between coefficients of thermal expansion of adhesive and adherend materials. Mathematical models and solutions on the thermal residual stress analysis have been continuously improved. This paper reviews the current status of mathematical models, and offers an improved mathematical model and numerical solution method by considering two-dimensional thermal stress and deformation states of adhesively bonded bi-directional functionally graded clamped plates subjected to an in-plane heat flux along one of the ceramic edges. This mathematical model assumes the material properties of the functionally graded plates to vary with a power law along two in-plane directions and not through the plate thickness direction, in particular, considers the spatial derivatives of thermal and mechanical properties of the material, and enables the investigation of the effects of the bi-directional composition variations and spatial derivative terms on the displacement, strain and stress distributions. The heat conduction and Navier equations describing the two-dimensional thermo-elastic problem are discretized using finite-difference method, and the set of linear equations are solved using the pseudo singular value method. The functionally graded plates relieve both stress and strain distributions and levels in the adhesive layer and in the plates even though the adhesive layer is still ungraded. The spatial derivatives of mechanical and thermal properties of the local material become more effective on the strain and stress distributions of the plates and adhesive layer. The model, disregarding these derivative terms, exhibits sensitivity to small changes in the compositional gradients (n, m) by adjusting the variations of ceramic volume fraction along the x- and y-directions, respectively, and instability in the calculation of stress and strain distributions and levels. However, the improved model with material derivatives, which considers the effects of these derivative terms, predicts stress and strain distributions and levels complying with changes in the compositional gradient exponents.