A passive tensioning system is disclosed for composite material that is dispensed by a composite placement machine. A spool is mounted on a spool shaft and material on the spool is pulled from the spool and applied to a surface. The tensioning system has a drag brake on the spool shaft and a drag brake control for the drag brake. A dancer roll is mounted on a linear slide having a spring force and a slide control is provided for the linear slide. A control system continually varies the drag brake control and the slide control to control the tension of the composite material based on the instantaneous operating characteristics of the composite placement machine.