This study investigates wave propagation in a functionally graded circular cylinder subjected to dynamic loads. The cylinder material consists of metal (Ni) and ceramic (Al2O3), and material properties vary through the thickness direction with a power-law distribution in terms of volume fractions of the constituents. In order to estimate the through-thickness material properties of the functionally graded circular cylinder, the Mori-Tanaka homogenization scheme was implemented. The governing equations of the wave propagation in the functionally graded circular cylinder were discretized by using the finite difference method. In order to circumvent stability issues experienced in the finite difference method and to obtain a numerical solution with an acceptable accuracy, the time step size was obtained using von Neumann stability approach. The results show that the material composition variation had evident effects on wave propagation of the functionally graded circular cylinder. (C) 2014 Elsevier Ltd. All rights reserved.