To improve the physical and gas barrier properties of biodegradable poly(lactic acid) (PLA) film, two graphene nanosheets of highly functionalized graphene oxide (0.3 wt% to 0.7 wt%) and low-functionalized graphene oxide (0.5 wt%) were incorporated into PLA resin via solution blending method. Subsequently, we investigated the effects of material parameters such as loading level and degree of functionalization for the graphene nanosheets on the morphology and properties of the resultant nanocomposites. The highly functionalized graphene oxide (GO) caused more exfoliation and homogeneous dispersion in PLA matrix as well as more sustainable suspensions in THF, compared to low-functionalized graphene oxide (LFGO). When loaded with GO from 0.3 wt% to 0.7 wt%, the glass transition temperature, degree of crystallinity, tensile strength and modulus increased steadily. The GO gave rise to more pronounced effect in the thermal and mechanical reinforcement, relative to LFGO. In addition, the preparation of fairly transparent PLA-based nanocomposite film with noticeably improved barrier performance achieved only when incorporated with GO up to 0.7wt%. As a result, GO may be more compatible with hydrophilic PLA resin, compared to LFGO, resulting in more prominent enhancement of nanocomposites properties.