The experimental fact that the acoustic emission (AE) of a shape memory alloy (SMA) is confined well in the temperature range of the martensitic transformation hysteresis suggests the possibility of there being an SMA that is suitable for use as a temperature-sensing device sending AE signals out. This study has proposed a method to measure the temperature at the point of a small SMA particle in a solid body by detecting the AE signals from the particle. Moreover, a two-sensor method, which is the technique for locating the source of AE signals by measurement with two AE sensors, has been applied. It allows us to monitor the temperatures at many points in the solid body with many SMA particles in it. The proposed method was examined using a model composite material that was composed of five SMA particles lying in an array in an aluminum plate. It is shown that the method could locate the positions of the particles having emitted AE signals by martensite transformation. It has also been proposed that the AE during deformation of the SMA can be used for sensing stress. When a point load was applied at various positions on the surface of an epoxy-SMA particle composite plate, the AE method located the point load correctly.