In this paper, a novel artificial muscle/tendon structure is developed for achieving bio-inspired actuation and self-sensing. The hybrid structure consists of a dielectric elastomer (DE) material connected with carbon fibers, which incorporates the built-in sensing and actuation capability of DE and mechanical, electrical interfacing capability of carbon fibers. DEs are light weight artificial muscles that can generate compliant actuation with low power consumption. Carbon fibers act as artificial tendon due to their high electro-conductivity and mechanical strength. PDMS material is used to electrically and mechanically connect the carbon fibers with the DE material. A strip actuator was fabricated to verify the structure design and characterize its actuation and sensing capabilities. A 3M VHB 4905 tape was used as the DE material. To make compliant electrodes on the VHB tape, carbon black was sprayed on the surface of VHB tape. To join the carbon fibers to the VHB tape, PDMS was used as bonding material. Experiments have been conducted to characterize the actuation and sensing capabilities. The actuation tests have shown that the energy efficiency of artificial muscle can reach up to 0.7% and the strain can reach up to 1%. The sensing tests have verified that the structure is capable of self-sensing through the electrical impedance measurement.