A well‐conditioned volume‐surface integral equation, called the volume integral equation‐ combined field integral equation, is applied to analyse electromagnetic (EM) scattering from arbitrarily shaped three‐dimensional composite objects comprising both inhomogeneous bi‐anisotropic material and closed perfect electric conductors (PECs). The equivalent surface and volume currents are respectively expanded using the commonly used RWG and SWG basis functions, while a matrix equation is derived by the method of moments. Because the magnetic field integral equation is involved in modelling the surface electric current, and the constitutive parameters are all tensors, some new kinds of singularities are encountered and properly handled in the filling process of the impedance matrix. Several numerical results of EM scattering from composite bi‐anisotropy and closed PEC objects are shown to illustrate the accuracy and efficiency of the proposed scheme. The validity of the continuity condition of electric flux enforced on the bi‐anisotropy‐PEC interfaces, which can be used to eliminate the volumetric electric unknowns, is also verified.