An optical and semidestructive method to determine surface residual stress, which combines digital image correlation (DIC) with sharp indentation testing, is proposed. Based on the expanding cavity model, when a semi-infinite body is subjected to uniform equi-biaxial residual or applied stresses, the surface displacement around the indentation satisfies radial profiles. Therefore, the relation between the radial displacement and the residual or applied stresses on the surface of a semi-infinite body can be determined. The described relation was tested using indentation experiments for different applied stress states in aluminum. These states were generated using a stress-generating setup with two independent orthogonal loading axes. DIC was used to measure the displacement. The magnitude of the residual stress was obtained using nonlinear curve fitting based on theoretical analysis, as well as linear curve fitting since the experimental data almost had a linear relationship. The calculations are in good agreement with the values of applied stresses.