An electroless plating and hot-pressing process was developed to fabricate silver matrix composites reinforced with uniformly distributed graphite and Saffil short fibers (Graphitesf and Saffilsf). The hardness of the composites increases as the content of short fibers increase. Static-gap, single-spark erosion and repeated-collision, multiple-arc erosion tests were used to investigate the arc erosion behavior of the composites. The composites exhibited better arc erosion resistance when the contents of short fibers were increased in a static-gap, single-spark erosion test. However, the weight loss of the composites after 10,000 times repeated-collision, multiple-arc erosion operation shows that the composites with low volume percents of short fibers have a good arc erosion resistance. The Saffilsf/Ag composites show a better arc erosion resistance than Graphitesf/Ag because of the greater strengthening effect of the finer Saffil short fibers. The erosion behavior of the composites is dominated by the viscosity of composites in single-spark tests, while it depends on the competition of viscosity and thermal properties in multiple-arc tests.